A business pays off a note payable. What effect does this have on the accounting

equation?

Assets go up$,$ liabilities go down, and stockholders' equity remains the same.

Assets go down, liabilities remain the same, and stochkolder's equity goes up$.$

Assets go up$,$ liabilities remain the same, and stockholder's equity goes up$.$

Assets go down, liabilities go down, and stockholder's equity remains the same.