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Accounts Payable
Sometimes referred to as trade payables, accounts payable is an account sub-ledger that records all the amounts that a company or a person owes to suppliers but has not paid yet.
3,095 Questions
What is a debit note and what is it used for?
A debit note is a document that is used by a buyer to inform the company of the quality of goods and price of the goods that are being returned. Debit note is also known as a debit memo.
Where can someone find samples of invoices?
Quickbooks offers free invoice templates. Microsoft Publisher has several base invoices to create whatever is needed by their customers. Office Depot also has this product.
What the difference between prepaid and accrued expense and accounts payable?
1. Prepaid Expenses:
These are those expenses, the payment of which has made by company in advance but the benefit or actual services has not yet received by the company that's why it is current asset of company for example prepaid rent.
Accrued Expenses:
These are those expenses the benefit of which has already received by company but payment has not yet made example is employees salaries which are accrued on last date of month and paid later.
Accounts Payable:
When company purchased goods from vendors on credit and payment is due in later time period this transaction creates the accounts payable till the actual payment is made to the vendors.
Why drawing is recorded in debit side of accounting?
If you're drawing funds from an account - it is a debit action.
Why notes payable instead of accounts payable?
Notes Payable is used to show that it's a note. A note is determined by the signing of a Promissory Note or some similar contract. For example, when you purchase a vehicle (unless you are purchasing said vehicle with cash) you sign a contract (Promissory Note) in which you pay X amount by a certain day each month.
What is the journal entry customer goods returned on credit?
debit goods returned
credit accounts receivable
Why do accounts payable ledger require a subsidiary account?
As in business company purchases materials or goods from different vendors on advance same like sales to different clients on advance, so if all clients balance is transferred to one accounts payable account then it will be impossible to keep track of saperate payments to different vendors that;s why separate accounts are maintained.
What is the normal account balance for the accounts payable ledger account?
1. As accounts payable is the liability of the company to be paid in future so in this way like all other liabilities accounts balance, accounts payable has also credit balance.
What will be the journal entry if the invoice is received from supplier?
There is no entry for receiving invoice from suppliers rather entry is made when goods purchased from suppliers.
What is the T account for Journal entry for Machinery purchased on cash?
find out the accounts involed in eash of the following cases
Q:- machinery purchased for cash.
Q:- furniture is purchased on cresit
Why does an accounts payable show up on your balance sheet when you have cut checks for those bills?
no
Is paid up capital a debit or a credit account?
aid up capital is the amount invested by owners towards business and it is the liability of business to pay back so it is liability of business and as all liability accounts it has also credit balance.
What is the two methods of preparing trial balance?
A trial balance may be prepared according to either of the following two methods:
Total method:
If the total of debit sides of all accounts in the ledger is placed in one column of the list and similarly total of credit sides of all the accounts in the ledger is placed in another column of the list then list of total will be known to have been prepared with the total methods.
Balances method:
According to this system a trial balance is prepared on the basis of balances of accounts. It is based on the mathematical maxim that if equals are taken away from equals, results are equal. This method is simple and requires less work.
What Are objective of learning financial managements?
Objectives of Financial Management
The financial management is generally concerned with procurement, allocation and control of financial resources of a concern. The objectives can be-
To ensure regular and adequate supply of funds to the concern.
To ensure adequate returns to the shareholders which will depend upon the earning capacity, market price of the share, expectations of the shareholders.
To ensure optimum funds utilization. Once the funds are procured, they should be utilized in maximum possible way at least cost.
To ensure safety on investment, i.e, funds should be invested in safe ventures so that adequate rate of return can be achieved.
To plan a sound capital structure-There should be sound and fair composition of capital so that a balance is maintained between debt and equity capital.
Accounting entries for the purchase of extension sockets?
[Debit] Extension sockets expense
[Credit] Cash
What are credit terms of net 30 eoap?
End of accumulation period of net 30 means you will be paid in 30 days. Many businesses use net 30 for payment terms.
Why may a control account carries both debit and credit balances?
A control account summarizes a set of subsidiary accounts. For example, Accounts receivable may have a control account, representing total Accounts receivable, and also may have a set of subsidiary accounts, representing the amount of Accounts receivable owed by each customer/debtor. The total of all subsidiary accounts must equal the balance of the control account.
Control accounts will have debit or credit balances depending on the nature of those accounts. Control accounts for assets, such as Accounts receivable or Fixed assets, will have native debit balances. Control accounts for liabilities, such as Accounts payable, will have native credit balances.
When an interest-bearing note matures what is the balance in the notes payable account?
The principal or maturity value. The premium or discount should be fully amortized down to zero.
Is wages current liabilitys or non current liabilitys?
If wages already paid then it is current expense, if wages are payable within current fiscal year then it is current liabilities, if wages are payable in morethan one fiscal year that the amount payable in current fiscal year is current liability and the remaining amount will be treated as long term liability.
What is the journal entry for collections on account?
Collections on account refer to money collected from customers who have already received goods/services on credit.
Hence, the double entry is:
Dr Cash
Cr Accounts receivable
Is debit credit note issue for adjusting account balance if a supplier and customer is same?
Yes, a debit or credit note can be issued to adjust account balances between a supplier and customer when they are the same entity. A debit note is typically issued by the buyer to the seller, indicating a reduction in the amount owed due to returns or discrepancies, while a credit note is issued by the seller to the buyer to acknowledge the return or adjustment. This process helps maintain accurate financial records and balances for both parties involved.
Why is hierarchy of generally accepted accounting principles needed?
Accounting and financial reporting guidance is provided not only by the two major accounting standards-setting bodies, but also by the AICPA, the staffs of the accounting standards-setting bodies, and even professional literature. Because of the heavy workloads of the standards-setting bodies, they may not have issued guidance on a particular issue of concern to a practitioner. A hierarchy of generally accepted accounting principles allows a practitioner to look to the guidance of other bodies in the event the Board with jurisdiction has not issued a standard on a particular matter.
