A business paid creditors on account. What is the effect on this transaction on assets and liabilities?

Ok not quite sure if your questions is asking what happens when they pay their debts? Or if they incurr debts, so I will give you an answer for both:

If they incurr debt.. you <Dr.> cash (asset) and <Cr> Liability. So it increases assets and increases liabilties..

If they pay off the debt you're taking the liability off the books which is decreasing liabilities, and you're paying it off with cash so that decreases assets.. <Dr.>Liability. <Cr>. Asset..