The amount of money a company owes to its suppliers or creditors for goods or services received on credit.
Accounts Payable refers to the short-term debts and financial obligations that a business owes to its suppliers, vendors, and creditors for goods and services received. It represents the amount of money that a business needs to pay within a specific timeframe, usually within 30 to 60 days. Managing accounts payable effectively is crucial for maintaining good relationships with suppliers and ensuring timely payments. By staying organized and keeping track of outstanding invoices, small business owners can optimize cash flow, avoid late payment penalties, and enhance their overall financial health.