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Problem Regardin Notes Payable

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On the balance sheet we've had a note payable for 7 years as a balance of just say with interest all in is $50,000. We negotiated and paid the payable off for $20,000.00.

So we credit cash (Reduce Cash) and debit the payable but what do we do with the balance $30,000? This liability is gone because both parties agreed and signed off. Where does this get written to? Thanks for your assistance

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This solution helps answer a problem regarding notes payable.

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Hi,

Since you settled your debt and was "forgiven" of the balance, this effectively moves to increase your capital ...

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