Question

2 the journal entry to record the borrowing of cash and the signing of a note payable involves: multiple choice a debit to note payable and a credit to cash. debits to cash and interest expense and a credit to note payable a debit to cash and a credit to note payable all of these answer choices are incorrect

Explanation:

When a company borrows cash and signs a note - payable, it receives cash (an asset increase, which is debited) and incurs a liability (note - payable increase, which is credited). Interest expense is not recorded at the time of borrowing but over the life of the note as it accrues.

Answer:

C. a debit to cash and a credit to note payable