A T-account has a $698 credit balance. This account is most likely NOT:
A)Accounts Payable.
B)Sales Revenue.
C)Accounts Receivable.
D)Common Stock.

Question

Quizplus · Accepted Answer

A credit balance in an Accounts Payable account would indicate that the company owes money to its vendors or suppliers, which would have a debit balance.

A credit balance in a Sales Revenue account would indicate that the company has made sales that generated more revenue than the corresponding expenses, which would have a debit balance.

A credit balance in a Common Stock account would indicate that the company has received more money from issuing stock than it has spent on its initial investments, which would have a debit balance.

Therefore, the only option left is C) Accounts Receivable, which would indicate that the company has received payments from its customers but has not yet recorded the corresponding sales revenue.

A T-Account Has a $698 Credit Balance