What Is Accounts Payable?

Question

What Is Accounts Payable?

3 Answers

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Answer 1

Accounts payable are also known as creditor which is liability. They are debts owed by the company to the creditor. For example, when the company make a credit purchase, we shall increase (Credit) the account payable accounts.

It is reflected in balance sheet and can be recorded under long term or current liabilities depending on the nature of the account payable. Hope you uds. Thanks

Answer 2

Accounts payable are accounts that you owe money to and are considered a liability. The explanation above is far too wordy and does not answer the question properly.

Answer 3

Account payable is basically a kind of sequence, which is of an accounting transaction. This transaction covers payments to suppliers who need to give some kind of money for certain goods and services. Some of the very good examples of account payable is when from your very own home you give away cheques like electric company, telephone company, cable television or satellite dish service, newspaper subscription, and other such regular services.

Large organizations generally handle such payments with the help of accounting software, which help to update on the various money that needs to be given out. It is generally termed as a current liability, since the payment is due within 12 months from the start of the transaction date. Some of the other types of transactions are accounts receivable, payroll, and trial balance.