Question

The credit balance of personal account indicates

• A. Amount receivable
• B. Amount payable
• C. Expense
• D. Assets

Answer 1

Answer:

B. Amount payable

A personal account records transactions related to individuals, firms, or organizations. Credit balance in a personal account means the business owes money to that person or entity. Therefore, it represents an amount payable (liability). Examples: Creditor’s account showing ₹10,000 credit → The business owes ₹10,000 to the creditor. Other options: Amount receivable: Would be a debit balance in a personal account. Expense / Assets: Not indicated by a personal account’s credit balance.