Banks rely heavily upon customers' deposits as a source of funds. Demand deposits normally pay interest to
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Banks rely heavily upon customers' deposits as a source of funds. Demand deposits normally pay interest to the customer, who is entitled to withdraw at any time with- out prior notice to the bank. Checking and NOW (negotiable order of withdrawal) accounts are the most common form of demand deposits for banks. Assume that ABC Storage has a checking account at American Savings Bank. What type of account (asset, liability, owner's equity, revenue, expense, drawing) does the account balance of $13,850 represent from the viewpoint of
(a) ABC Storage and
(b) American Sav- ings Bank?
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