Question

State whether the following statements are True or False
Personal A/c showing credit balance is called creditor.

• A. True
• B. False

Answer 1

The correct option is A True

The personal A/c as the name suggests are of people. The rule for the Personal A/c is Debit the receiver and Credit the giver. The creditor is a person who lends us or gives us money. Thus, we shall credit the creditor A/c. So, any personal account showing a credit balance will be called a Creditor.

Thus, the correct answer is A.