Final answer:
The initial financial position of a ledger is established using a T-account balance sheet, which segregates a firm's assets and liabilities into two columns, ensuring that assets equal liabilities plus net worth.
Step-by-step explanation:
The beginning financial position of a ledger, such as the one for Singleton Bank with $10 million in deposits, is set up using a T-account balance sheet. This T-account is a two-column format that represents a firm's assets on the left and its liabilities on the right, resembling the shape of the letter 'T'. Singleton Bank's ledger would list its assets, including deposits held in its vaults and any loans made, while the liabilities would include the deposits owed to depositors. Net worth is calculated as total assets minus total liabilities and is shown on the liabilities side to ensure the account balances. In the beginning, assets must equal liabilities plus net worth, whether the bank is healthy or bankrupt.