Final answer:
A balance sheet is a statement showing a firm's financial position, including assets, liabilities, and equity, on a specific date. For banks, it includes cash reserves, loans, securities, and deposits owed to customers. This statement is true.
Step-by-step explanation:
The statement is true. A balance sheet is indeed a statement of the financial position of a firm on a given date, which includes its asset holdings, liabilities, and equity. Assets represent valuable items owned that can be used to produce income, such as cash and property. Liabilities are debts owed, such as mortgages and loans. The difference between the total assets and total liabilities is known as the net worth or equity of the firm.
Specifically for a bank, the balance sheet will list assets such as cash in vaults, reserves at the Federal Reserve, loans to customers, and securities like U.S. Treasury bonds. Liabilities include customer deposits and other debts. The equation summarizing a balance sheet is Assets = Liabilities + Equity, indicating the balance between what a bank owns and owes, alongside its net worth.