Buyer Company Asks to Extend Its Past Due $600 Account

question 77

Multiple Choice

Buyer Company asks to extend its past due $600 account payable to Seller Company.Seller Company agrees to accept $100 cash and a 60-day,12%,$500 note payable to replace the account payable.How does Buyer Company record this event in the general journal?

• A) \[\begin{array} { | c | r | r | }
• \hline \text { Accounts Payable } & 600 & \\
• \hline \text { Cash } & & 100 \\
• \hline \text { Notes Payable } & & 500 \\
• \hline
• \end{array}\] 00 Notes Payableompany record this event in the general journal?
• B) \[\begin{array} { | l | r | r | }
• \hline \text { Notes Payable } & 500 & \\
• \hline \text { Cash } & 100 & \\
• \hline \text { Accounts Payable } & & 600 \\
• \hline
• \end{array}\]
• C) \[\begin{array} { | l | r | r | }
• \hline \text { Cash } & 100 & \\
• \hline \text { Accounts Payable } & & 100 \\
• \hline
• \end{array}\]
• D) \[\begin{array} { | c | r | r | }
• \hline \text { Accounts Payable } & 100 & \\
• \hline \text { Cash } & & 100 \\
• \hline
• \end{array}\]
• E) Buyer Company has no entry to record for this transaction.

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Definitions:

Tetanus

A bacterial infection characterized by muscle spasms, commonly caused by a toxin produced by the bacterium Clostridium tetani.

Secretions

Substances produced and released by cells or glands in the body, fulfilling various functions like lubrication, digestion, and defense against pathogens.

Intestinal Tract

The continuous tube running from the stomach to the anus, part of the digestive system, responsible for nutrient absorption and waste excretion.

Synapse

The minute space between the axon of one neuron and the dendrite of another.