On July 1, 2016, Goode Company Borrowed $100,000

Multiple Choice

On July 1, 2016, Goode Company borrowed $100,000. The company signed a note payable with interest at 6 percent per year. The note and interest are due on December 31, 2016. On December 31, 2016, Goode paid $103,000 to settle the debt in full. Assuming no accruals for interest have been made during the year, transaction analysis of the $103,000 cash payment on December 31, 2016 should reflect which of the following?

A) A decrease in assets of $103,000 and a decrease in liabilities of $103,000.
B) A decrease in assets of $100,000, a decrease in stockholders' equity of $3,000, and a decrease in liabilities of $103,000.
C) A decrease in stockholders' equity of $100,000, a decrease in liabilities of $3,000, and a decrease in assets of $103,000.
D) A decrease in liabilities of $100,000, a decrease in stockholders' equity of $3,000, and a decrease in assets of $103,000.