Final answer:
The question provides figures for creating a bank's T-account balance sheet, not a cash account balance. A T-account includes assets such as reserves, government bonds, and loans, and liabilities consisting of deposits. The bank's net worth is calculated by subtracting liabilities from assets, which results in $220 in this case.
Step-by-step explanation:
Bank T-Account Balance Sheet and Net Worth Calculation
To answer the question about the adjusted balance in the Cash account on January 31, it's essential to clarify that the details provided pertain to a bank's balance sheet rather than a cash account statement.
Therefore, the actual balance cannot be determined from the given data as it relates to a bank's assets and liabilities, not a cash account.
However, I will demonstrate how to set up a T-account balance sheet for a bank based on provided figures and then calculate the bank's net worth.
T-Account Balance Sheet:
Assets:
- Reserves: $50
- Government Bonds: $70
- Loans: $500
Liabilities:
Net Worth:
To determine the bank's net worth, we subtract total liabilities from total assets.
Total Assets = Reserves + Government Bonds + Loans = $50 + $70 + $500 = $620
Total Liabilities = Deposits = $400
Net Worth = Total Assets - Total Liabilities = $620 - $400 = $220