What effect does the collection of a note receivable,excluding interest,have on the accounting equation?
A)Total assets remain the same.
B)Assets are reduced and stockholders' equity is reduced.
C)Assets are increased and stockholders' equity is increased.
D)Assets are reduced and liabilities are reduced.

Question

Quizplus · Accepted Answer

The entry includes a debit to Cash (to increase that asset account)and a credit to Notes Receivable (to decrease that asset account).Total assets remain the same.Liabilities and stockholders' equity are not affected.

What Effect Does the Collection of a Note Receivable,excluding Interest,have