The accounting entry to record the payment of a liability is which of the following?
A) Debit an asset account and credit a liability account
B) Debit a liability account and credit an asset account
C) Debit an equity account and credit a liability account
D) Debit a liability account and credit an equity account

Question

Quizplus · Accepted Answer

When paying off a liability, the liability account must be debited to decrease it and the asset account used to pay off the liability must be credited. This results in a decrease in both liability and asset accounts. Thus, the correct accounting entry is to debit a liability account and credit an asset account.

The Accounting Entry to Record the Payment of a Liability