_________ are things a firm owns or what a firm can claim from other:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Assets
Assets are things a firm owns or what it can claim from others. For a bank, the buildings and furniture it owns are assets. So are the loans it has given, because each loan is the bank’s claim on the borrower.
Option (1) Assets — Correct. They are what a firm owns or can claim.
Option (2) Liabilities — Incorrect. Liabilities are the opposite: a firm’s debts, or what it owes to others.
Option (3) Deposits — Incorrect. For a bank, deposits are its main liability, because the bank must pay them back to the people who kept them.
Option (4) Reserves — Incorrect. Reserves are a bank’s cash and its deposits with the RBI. They are one kind of asset of a bank, not the name for all things a firm owns or can claim.
NCERT (2026-27): “3.3 Money Creation by Banking System … Balance sheet is a record of assets and liabilities of any firm. Conventionally, the assets of the firm are recorded on the left hand side and liabilities on the right hand side. Accounting rules say that both sides of the balance sheet must be equal or total assets must be equal to the total liabilities. Assets are things a firm owns or what a firm can claim from others. In case of a bank, apart from buildings, furniture, etc., its assets are loans given to public. When the bank gives out loan of Rs 100 to a person, this is the bank’s claim on that person for Rs 100. Another asset that a bank has is reserves. Reserves are deposits which commercial banks keep with the Central bank, Reserve Bank of India (RBI) and its cash.… …Assets = Reserves + Loans Liabilities for any firm are its debts or what it owes to others. For a bank, the main liability is the deposits which people keep with it.…” |