Final answer:
The note would affect Miller Company's financial statements by changing its asset profile, where the loan is considered an increased asset, and reserves reflect liquidity and regulatory compliance. These changes influence the bank's overall equity as represented on the balance sheet.
Step-by-step explanation:
Discussing the impact of a note on Miller Company's financial statements would likely involve examining how new financial activities, such as a loan described in the given scenario, affect the company's balance sheet. When discussing the Singleton Bank's balance sheet, which now includes a $1 million in reserves and a $9 million loan to Hank's Auto Supply while maintaining $10 million in deposits, we can infer certain impacts on financial statements.
For instance, the loan would be listed as an asset for the bank, since it represents money that will be paid back with interest, increasing the bank's potential for revenue. However, the need to maintain reserves also reflects regulatory requirements and a cushion against potential losses, ensuring liquidity. These changes must be accurately reflected in the balance sheet, highlighting the bank's financial status and affecting the equity of the bank, shown in the equity portion of a balance sheet.