The official business definition of Accounts Payable is that it is an expense. Accounts Payable is the amount of money that a company owes to its suppliers, vendors, or other businesses for goods or services that have been purchased on credit. This amount is usually due within a certain period of time, and the company must pay the amount in full in order to avoid late fees or other penalties. Accounts Payable is typically recorded as a current liability on the company’s balance sheet, as it is a debt that must be paid in the near future. It is important to note that Accounts Payable is not the same as Accounts Receivable, which is the amount of money that a company is owed by its customers. Accounts Payable is an expense for the company, as it is money that must be paid out, while Accounts Receivable is an asset, as it is money that is owed to the company.
