Question

The depositor's checking account balance in the bank records is a(n) _____.

1) liability
2) expense
3) income
4) asset

Answer 1

The depositor's checking account balance in the bank records is a liability. Hence, the correct answer is option (1).

Step-by-step explanation:

The depositor's checking account balance in the bank records is a liability. When bank customers deposit money into a checking account, the bank views these deposits as liabilities because the bank owes these deposits to its customers when they wish to withdraw their money.

Therefore, the checking account balance is considered a liability on the bank's balance sheet.