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On January 1, 2021, the general ledger of Dynamite Fireworks shows the following account balances:

1 Answer

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Final answer:

The question is about a change in Singleton Bank's business plan that resulted in an update to its balance sheet, where assets now include $1 million in reserves and a $9 million loan to Hank's Auto Supply, yet it still maintains $10 million in deposits.

Step-by-step explanation:

The subject of the question is related to the Business field, specifically within the topic of banking and finance. It deals with the impact of a change in business strategy on the balance sheet of a bank named Singleton Bank.

According to the given information, Singleton Bank made alterations to its balance sheet, likely due to a revised business plan.

As a result, Singleton's assets now include $1 million in reserves and a $9 million loan to Hank's Auto Supply. Despite these changes, the bank maintains $10 million in deposits, indicating no change in its liabilities.

This example illustrates how restructuring the assets of a bank, such as adjusting the level of reserves or changing the distribution of loans, affects the overall financial statement without necessarily altering the total amount of deposits the bank holds.