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Loans, Part 3, Question 14
#1
Are loans debited to the cash account, or not (they aren't in the question)? Where do they go if not?
Excelsior, BS, pursuing degree

Completed:
CLEP: Hum. (67), Hist. of U.S. I (74), Hist. of U.S. II (71), Intro. Psych. (69), Intro. Soc. (72), Soc. Sci. and Hist. (74), Western Civ I (72), Western Civ II (70), Am. Lit. (60), Intro. to Educ. Psych. (62), P. of Management (74), P. of Market. (74), Intro. Bus. Law (67), P. of Accounting (60), AmGov (68)
DSST: Ethics in Am. (76), P. of Super.(67), HRM (65), Intro to Bus. (70), MIS (65), P. of Fin (62), M&B (65), P. of Stat. (68)
ECE: OB (B)
TECEP:: IntFin, SecAna

Others

Total Credits: 129
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#2
I believe they are debited to the cash account. I hope I'm not wrong on that one. :eek:
Big Grin Matymus Primehilarious
Waterloo, NY
Excelsior College
B.S. General Business, Class of 2008


Fall 2011 - currently pursuing Pre-Pharmacy
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#3
Matymus Wrote:I believe they are debited to the cash account. I hope I'm not wrong on that one. :eek:

You are not wrong on this one Matymus,

Assuming that the loan is made TO the company, it would INCREASE (debit) the cash account (current asset). At the same time, it would also INCREASE (credit) the Bank Loan Payable account (current liability).

Hope that helps,
Snazzlefrag
My name is Rob
_____________________________________
Exams/Courses Passed (43):
- Courses (4): 1 Excelsior, 1 CSU-Pueblo, 2 Penn Foster.
- Exams (39): 24 DSST, 15 CLEP.

Total Credits: 142 (12 not used).
[SIZE=1]GPA: 4.0
[/SIZE]
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#4
snazzlefrag Wrote:You are not wrong on this one Matymus,

Assuming that the loan is made TO the company, it would INCREASE (debit) the cash account (current asset). At the same time, it would also INCREASE (credit) the Bank Loan Payable account (current liability).

Hope that helps,
Snazzlefrag

Good!! That's what I thought! I'm no CPA, but man...I like to at least think I have SOME accounting knowledge.
Big Grin Matymus Primehilarious
Waterloo, NY
Excelsior College
B.S. General Business, Class of 2008


Fall 2011 - currently pursuing Pre-Pharmacy
Reply


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