Question

A company purchased land in exchange for a $25,000, 10-year note payable. The increase in the Notes Payable account would be recorded with a ______.

Answer 1

The increase in the Notes Payable account would be recorded with a credit.

Notes payable account:

Assuming the company purchased land in exchange for a $25,000, 10-year note payable the increase in the Notes Payable account would be recorded with a credit.

The appropriate journal entry to record this transaction will be:

Journal entry

Debit Land $25,000

Credit Notes Payable $25,000

(To record note payable)

Inconclusion the increase in the Notes Payable account would be recorded with a credit.

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