A - the product will not get to market quicker because there is more raw materials.
Answer: a. a credit to Accounts Payable.
Explanation:
When paying off a note, cash will be used so cash will have to be credited to show that it is decreasing.
Interest expense will be debited by the interest accumulated on the loan because expenses are debited when they increase.
Notes Payable will be debited to show that the note has now been retired.
There is no credit for Accounts payable involved in this transaction.
It shows a pattern of responsibility.
If you have only had accounts for 1 month, it doesn't really give a full picture of whether or not you always make your payments on time, etc. However if you have had accounts for 20 years, creditors have more history to look through to determine if you are responsible.
Keep in mind, checking and savings accounts are not the primary type of accounts that creditors want to look at because those only deal with spending money you already have. Lenders really want to know how you handle money that you <em>borrow</em>, such as school loans, credit cards, rent payments, and auto loans.
Answer:
The requirements are missing, so I looked for similar questions. You should make any necessary adjusting entries on the accounting equation. Since there is not enough room here, I used an excel spreadsheet.
