A company issues check to pay account payable . The effect of the transaction is to ??
Answers
Answer:
When an account payable is paid, Accounts Payable will be debited and Cash will be credited. ... The same date is used to record the debit entry to an expense or asset account as appropriate.
Answer:
The effect of the transaction is - Accounts Payable will be debited and Cash will be credited.
Explanation:
The accountant debits the account payable once the bill is paid to reduce the liability amount. The cash account is given the offset credit, which likewise reduces the cash balance. A rise in accounts payable from one period to the next indicates that the business is using credit to buy more products or services than it is reimbursing. When a corporation pays off its obligations to suppliers more quickly than it purchases new products or services on credit, a drop happens. A corporation that owes money to one or more creditors has an account payable (AP) liability. Accounts payable is frequently confused with a company's primary operating costs. However, the expenses that account payable reflect are shown on the income statement and balance sheet of the business, respectively.
Thus, accounts payable can be used as a credit or a debit in accounting and finance.