Final answer:
The correct journal entry for an internal service fund billing the General Fund includes a debit to 'Due from General Fund' and a credit to a revenue account like 'Service Revenues'. This entry reflects the extension of credit for services provided.
Step-by-step explanation:
When an internal services fund records a billing to the General Fund, the correct journal entry in the internal service fund would include a debit to Due from General Fund. This is because when the internal service fund provides services to the General Fund, it is essentially extending credit to the General Fund for those services. The internal service fund expects to be paid back, so the amount billed is recorded as an asset ('Due from General Fund'). The other side of the entry would typically include a credit to an income account, such as 'Service Revenues' or 'Billings to Departments', which represents the revenue earned from providing the service.