What is the effect on the statement of financial position when the business pays a creditor?
A)decrease asset creditor; decrease liability bank.
B)decrease asset bank; decrease liability creditor.
C)decrease asset bank; decrease equity.
D)none of the above.

Question

Quizplus · Accepted Answer

Paying a creditor results in a decrease in the bank balance (an asset) and a decrease in the liability to the creditor, accurately reflecting the transaction's impact on the statement of financial position.

What Is the Effect on the Statement of Financial Position