Jerome purchased a building for his business by signing a note to pay the amount due over the next ten years.Which of the following correctly describes how to record this transaction?

Question

Quizplus · Accepted Answer

When purchasing a building for a business by signing a note to pay the amount due over the next ten years, the correct way to record this transaction is to debit the asset account for the building and credit the liability account for the note payable. This is because the business has acquired an asset (the building) that will be paid for over time through a liability (the note payable). Therefore, option A is the correct choice.

Jerome Purchased a Building for His Business by Signing a Note