Question

bBusy Beaver, Inc. signed a $315,000, 5-year note payable to buy a new industrial veneer cutter. Busy Beaver paid $5,000 cash for transportation of the machine and $750 cash for installation costs. The journal entry to record this transaction will include a ______. (Check all that apply.)

Answer 1

Answer:

The answer are:

• Dr machinery $320,750
• Cr $315,000 Note Payable
• Cr $5,750 Cash

Explanation:

When machinery (fixed assets) increases you must debit that account $320,750

When liabilities (note payable) increase you must credit that account $315,000

When cash decreases, then you must credit the cash account $5,750