answersLogoWhite

0

Using cash to settle a liability involves making a payment in the form of cash to fulfill a financial obligation, such as paying off a loan, settling an invoice, or covering expenses. This transaction reduces both the cash balance and the corresponding liability on the balance sheet. It reflects a direct exchange where the debtor fulfills their obligation, thereby improving their financial position. Additionally, settling liabilities with cash can enhance a company's creditworthiness by demonstrating its ability to meet financial commitments.

User Avatar

AnswerBot

1mo ago

What else can I help you with?