Final answer:
The statement is true; deposits are not taxable income under both cash and accrual methods unless they can be applied toward a service like rent. Singleton Bank's activity of merely holding deposits would not result in income until those funds are put toward a revenue-generating service.
Step-by-step explanation:
The statement '0, 0 ($0 income under both cash method and accrual method. A deposit is not taxable income unless it can be applied toward rent)' generally aligns with the principles of accounting. It is true that in both cash and accrual accounting methods, a deposit is not considered taxable income until it is earned or it can be applied to a service such as rent. The reference to Singleton Bank having $10 million in deposits indicates that it is simply holding the funds for depositors. In a hypothetical situation where Singleton Bank does not earn interest on loans and does not pay interest to depositors, the bank would not have income to report. Therefore, under both the cash and accrual methods, the income would be reported as $0 until such time that the deposits can be applied toward a transaction that generates revenue for the bank.