Accounts payable are ... ?

Accounts payable are ... ?

• A. Accounts on which an organization owes money.
• B. Assets on the balance sheet.
• C. Cash equivalents.
• D. Revenue accounts.

Answer: (A)

Accounts payable are obligations to pay suppliers for goods or services received. They represent a liability and appear on the balance sheet as amounts the company owes, typically due within a short period. They are not assets, not cash equivalents, and not revenue accounts. In practice, you increase accounts payable when you buy on credit and decrease it when you pay the supplier.

Accounts payable are obligations to pay suppliers for goods or services received. They represent a liability and appear on the balance sheet as amounts the company owes, typically due within a short period. They are not assets, not cash equivalents, and not revenue accounts. In practice, you increase accounts payable when you buy on credit and decrease it when you pay the supplier.