A credit balance in which of the following accounts would indicate a likely error?

Question

A credit balance in which of the following accounts would indicate a likely error?

A. Fees Earned

B. Salary Expense

C. Capital Stock

D. Accounts Payable

Answer 1

b.

Answer 2

Grasshopper:

this is a queston that is testing your ability to distinguish what are normal account balances. See below for an explanation.

Answer - B

Fees earned  = Revenue,  therefore it should be a credit balance

Salaries Expense = expense, therefore it should normally be a debit balance  - should this be a credit balance it is likely to be a mistake

Capital Stock is and equity account and should be a credit balance

Accounts Payable  is a liability and it should be a credit balance

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