What is accounts payable?
Money your business owes to suppliers for goods or services already received but not yet paid for. Payable balances are usually settled on terms — Net 15, Net 30 — and are listed as a current liability on the balance sheet. Watching payables by age tells you which suppliers are about to stop being patient.
Example
You receive a $4,200 delivery from a supplier on Net 30 terms on June 3. Nothing has left your bank, but you owe the money, so $4,200 sits in accounts payable as a current liability from June 3 onward.
Pay it on July 2 and the payable clears while cash falls by $4,200. If you had returned $200 of the delivery, a supplier credit would net against the balance and you would pay $4,000.
The Payables screen ages every supplier balance and lets you pay straight from the row. Accounts payable software →
Nearby terms
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