Northwest Company received and immediately paid a $4,000 utility bill from Green River Gas and Electric Company. The entry by Green River Gas and Electric Company to record receipt of the payment would include

Question

Quizplus · Accepted Answer

When Northwest Company pays Green River Gas and Electric Company $4,000, Green River will record a debit to Cash (increasing their cash account) and a credit to Northwest Company's Accounts Receivable account. However, none of the given answer choices match this scenario, so the best choice is B: a debit to Cash, since that is a necessary part of the double-entry accounting system.

Northwest Company Received and Immediately Paid a $4,000 Utility Bill