Which of the following is correct for recording the payment to a supplier for a purchase previously made on account?
A)Debit Cash, Credit Payables/Creditors
B)Debit Inventory, Credit Cash
C)Debit Payables/Creditors, Credit Cash
D)Debit Cash, Credit Inventory

Question

Quizplus · Accepted Answer

When a payment is made to a supplier for a purchase previously made on account, the accounts involved are Payables/Creditors and Cash. Payables/Creditors account is credited to reduce the liability of the company towards the supplier and Cash account is debited to Show the reduction in the cash balance of the company. 
Option A and D are incorrect as they do not involve the Payables/Creditors account. Option B is incorrect as it involves Inventory account, which is not relevant in this transaction as the purchase has already been made and recorded in the accounts.

Which of the Following Is Correct for Recording the Payment