A business paid $2,500 on account.The journal entry would:
A)debit Accounts Receivable for $2,500 and credit Revenue for $2,500.
B)debit Accounts Payable for $2,500 and credit Cash for $2,500.
C)debit Cash for $2,500 and credit Retained Earnings for $2,500.
D)debit Cash for $2,500 and credit Accounts Payable for $2,500.

Question

Quizplus · Accepted Answer

When a business pays on account, it reduces its liability. Therefore, Accounts Payable is debited, and Cash is credited to reflect the outflow of cash.

A Business Paid $2,500 on Account