Final answer:
Employee salaries and account transfers can appear in a business's cash journals but not on the bank statement until the bank processes them. The money listed under assets on a bank's balance sheet may not be physically present due to the fractional-reserve system, which allows banks to lend out part of their deposits. Option C is correct.
Step-by-step explanation:
Two things that may appear in a business's cash journals but not in the bank statement are employee salaries and account transfers. This is because the cash journal records all cash transactions that occur in the business, whereas the bank statement only reflects transactions that have been processed and recorded by the bank.
Employee salaries are an example of internal transactions that may be recorded in the business's cash journal once the payment is authorized but might only appear on the bank statement when the actual transfer of funds occurs. Similarly, account transfers that are documented internally will appear in the cash journal, but not on the bank statement until the bank processes them.
As to why the money listed under assets on a bank balance sheet may not actually be in the bank, it is because banks operate on the fractional-reserve system, which allows them to lend out a portion of the deposits they receive, keeping only a fraction of the total deposits as reserves. This means that even though these loans are counted as assets, the actual cash is not physically present in the bank; it has been distributed as loans to borrowers.