Xenon Corporation borrows $75,000 from First Bank.Xenon Corporation records this transaction with a:
A)Debit to Investments.
B)Credit to Retained Earnings.
C)Credit to Notes Payable.

Question

Quizplus · Accepted Answer

When a company borrows money from a bank, it creates a liability called "Notes Payable". Therefore, the recording of this transaction would include a credit to Notes Payable.

Xenon Corporation Borrows $75,000 from First Bank