A business repays the amount borrowed on a note with cash.Which of the following accounts is credited?
A) Accounts Payable
B) Cash
C) Notes Payable
D) Notes Receivable

Question

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When a business repays the amount borrowed on a note with cash, the account for cash is credited. This entry reflects a decrease in the cash account and highlights that the amount owed on the note has been paid. The Notes Payable account is debited to decrease the balance due. The Accounts Payable account pertains to the money a business owes to its creditors and is not directly applicable in this scenario. The Notes Receivable account is used when a business receives a note from a debtor and is waiting to collect the amount owed.

A Business Repays the Amount Borrowed on a Note with Cash.Which