02/10/2020 by Beki Wallace AATQB MIAB 0 Comments
Formally known as accounts payables.
Money owed to suppliers for goods and services already supplied are payables.
Things that the business has to pay.
Payables represent a liability for a business and will be shown within the Balance Sheet.
Accounts receivables are the opposite, being money owed to the business. Money due to received.
At the end of each period it is essential to be aware of payables still outstanding.
This is to make accurate reporting to meet financial obligations.
Sometimes a bill is received that has not yet been paid.
It is the responsibility of an owner to calculate the amount likely to be payable.
An example of which are utility bills, as invoices are often received after services have been provided.
If costs are fixed this can be fairly easy to calculate, but if costs vary this can be more tricky.
This is where a little guidance comes in handy.