Accounting: paid creditors on account.

Question

what is the effect of this transaction? is it, debit to accounts payable and credit to cash? im not sure of it because of the word 'account' and i think there is still no cash included on this transaction.. please help.

Answer 1

haha debiting cash is a mistake.....if I take your company's money and you debit cash good luck in balancing your books

Answer 2

 omg this is retarded what is the real answer ???!!!!

Answer 3

debit creditor , credit account payable

Answer 4

read the question again...cash is not involved in this transaction. "paying creditors on account." you guys got led astray from guest 6969. in essence, youre increasing one liability while decreasing a different one.

Answer 5

Guest 6969 I think you are just trying to p**s people off by s******g around and giving the wrong answer just f*ck off!!! you debit accounts payable and credit cash I am an accountant I would know!

Answer 6

If you debit cash that means that you have money coming in!!! When you have money going out ( to pay something off) you credit cash!!!!! Crediting accounts payable will increase it because it is a liability account. So if you are paying off creditors you will have to debit accounts payable to reduce the account. So you debit accounts payable and credit cash!!!!!Guest6969 ur an idiot!!!!

Answer 7

it is not backwords. Account payable would be debited and cash would be credited because you are reducing your cash to pay off creditors dumbass. You are paying with account and that is a liability.

Answer 8

aren't you just shifting when the money is owed because you are paying someone who is owed money by putting it on account to pay later, so there is no change to anything?

Answer 9

the above answer isn't correct. since you are reducing your cash supply to pay off creditors, you would have to credit your cash account and debit your accounts payable account, to reduce the asset cash and the liability accounts payable.