Final answer:
The basic concept that assets equal liabilities plus owners' equity is central to the balance sheet, a fundamental accounting tool. The T-account is a representation of this in accounting, showing assets on one side and liabilities and net worth on the other.
Step-by-step explanation:
The statement "Assets are always equal to the sum of liabilities plus owners' equity" refers to the fundamental accounting equation and is the core concept underlying the organization of a balance sheet. In a bank's balance sheet, assets include valuable items the bank owns, like its reserves, loans made to customers, and U.S. Government Securities. Liabilities represent what the bank owes to others, including customer deposits. The net worth or equity is calculated as total assets minus total liabilities and is also referred to as bank capital.
This net worth is a crucial figure as it signals the financial health of the bank, being positive for a healthy business and negative for a bankrupt firm. On a T-account, which is a visual representation used in accounting, the left side lists assets and the right side lists liabilities and owner's equity. To ensure the T account balances, assets must always be equal to the sum of liabilities and net worth.