Final answer:
To represent ledger accounts using a T-account for Singleton Bank with $10 million in deposits, we record the deposits as liabilities and an equal amount in reserves as assets. This visual representation shows the bank's financial position with assets equal to liabilities in the T-account format.
Step-by-step explanation:
The subject of the question involves creating a T-account to represent ledger accounts for a hypothetical bank called Singleton Bank. A T-account is a visual representation of the financial position of a business, with a two-column format that outlines the company's assets on the left and its liabilities (and net worth) on the right, giving it the appearance of the letter 'T'. To post an entry, we would begin by acknowledging the $10 million in deposits as a liability. Simultaneously, since the bank is holding all of these deposits, the same amount would be recorded as assets under reserves. Below is an example of how the T-account would be structured for Singleton Bank when it holds all the deposits in its vaults:
We see here that the assets equal the liabilities, which is an essential principle in accounting called the accounting equation. The bank's net worth is calculated as total assets minus total liabilities. In a healthy business, net worth would be positive. In the context of Singleton Bank, since all deposits are held as reserves and no loans are made, net worth is not directly affected in this simplified scenario.