Final answer:
The assertion that a customer's account is credited as a representation of the bank's liability is true. Banks record deposits as liabilities and reflect this on their balance sheets or T-accounts. The net worth of a bank is the difference between its assets and liabilities.
Step-by-step explanation:
The statement that a customer account is credited when cash is deposited because the customer account represents a liability to the bank is true. When a bank receives a deposit, it incurs an obligation to pay back the depositor, making the deposit a liability on the bank's balance sheet. The customer's bank account is credited, increasing the balance as a record of the bank's obligation to them.
Banks function as financial intermediaries in the financial capital market, standing between savers who supply financial capital and borrowers who demand loans. The bank's balance sheet, also known as a T-account, will reflect this with deposits listed as liabilities and loans as assets. The net worth of a bank is found by subtracting liabilities from assets, and the role of banks in creating money through the process of lending is significant for economic transactions.