March 10 Accounts Payable 800 Cash 800 Paid creditors on account What effect does this journal entry have on the accounts? a Decrease accounts payable, decrease cash b Increase cash, decrease accounts payable c Increase accounts payable, increase cash d Decrease accounts payable, increase cash

Question

Carly Branch

Business

12 April, 05:03

March 10 Accounts Payable 800 Cash 800 Paid creditors on account What effect does this journal entry have on the accounts? a Decrease accounts payable, decrease cash b Increase cash, decrease accounts payable c Increase accounts payable, increase cash d Decrease accounts payable, increase cash

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Answers (1)

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Austin Sherman · Answer 1

a Decrease accounts payable, decrease cash

Explanation:

Journal entry: It is a recording of transactions in which one account is debited whereas the other account is credited. It follows double - entry accounting.

Moreover, it also follows the golden rule of accounting - debit the receiver and credit the giver, debit all expenses and losses & credit all income and gains, etc.

In this journal entry, the account payable balance would be decreased by $800 and along with it the cash balance is also decreased by $800 as cash is paid to the creditors

So, all options are incorrect except A option.