In which type of accounting is the issuance of money for a personal loan to a borrower typically recorded?

• A. Managerial accounting
• B. Personal accounting
• C. Cost accounting
• D. Financial accounting

Answer: (B)

Verified step by step guidance

1. Understand the context of the question: The issuance of money for a personal loan to a borrower is a financial transaction that involves recording the movement of funds.
2. Review the types of accounting mentioned: Managerial accounting focuses on internal decision-making, Cost accounting deals with cost analysis, Financial accounting records transactions for external reporting, and Personal accounting pertains to individual financial management.
3. Identify the correct type of accounting: Since the transaction involves recording a loan issuance, it falls under Financial accounting, which is concerned with documenting financial transactions for businesses or entities.
4. Clarify why other options are incorrect: Managerial accounting is not relevant because it deals with internal strategies, Cost accounting is unrelated to loans, and Personal accounting is for individual finances, not organizational transactions.
5. Conclude that Financial accounting is the appropriate type for recording the issuance of money for a personal loan to a borrower, as it aligns with the principles of documenting financial transactions for external purposes.