ABC signed a 5-year,9% note payable for $80,000 on May 1,2012.Which account will be credited when the note paid at maturity?
A) Note payable
B) Interest expense
C) Interest payable
D) Cash

Question

Quizplus · Accepted Answer

When the note is paid at maturity, the company will be debit the Note payable account and credit the Cash account for the payment amount. No interest or interest payable will be credited because the note has reached maturity and the interest has already been accounted for.

ABC Signed a 5-Year,9% Note Payable for $80,000 on May