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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
A check in most accounting is considered the same as cash and therefore it is treated the same.
A debit to the cash account will be made to note payment of the account and a credit to the appropriate account payable account to bring the AP down to a zero balance.
The check will then be deposited with the normal bank transactions and recorded as such in the bank statements for the company.
Are accounts receivable a debit or credit?
Accounts receivable is a debit.
Answer:
Accounts receivable is an asset and therefore maintains a debit balance. This is an account listing what a person or company owes you, or money that you expect to receive. Since it is an asset (all assets maintain a debit balance) it means to increase the account you debit it and to decrease it (when a payment is made by the customer) you credit it.
Assets = debit balance (increase with debit, decrease with credit)
Liabilities and Owners Equity = credit balance (increase with a credit, decrease with a debit)
(GAAP)
What if you paid some money on past due?
You could pay the rest a little later, and then you're all caught up.
How do you journal entry prepay account?
Dr: Prepayment to Suppliers
(In Case of Expense, then "Prepaid expense" account will be debited e:g Prepaid Rent)
Cr: Bank/Cash
What are the 7 non current liabilities?
Equity shares, debenture, secured loan, non secured loan, borrowings, reserves , retained earnings
6875 paid for five months so one month rent = 6875/5 = 1375
General entry is as follows
November 1, 2008 [Debit] Prepaid Rent 6875
[Credit] Cash 6875
December 31, 2008 [Debit] Rent Expense 1375
[Credit]Prepaid Rent 1375
Can closing stock be credited to the trial balance?
Yes if the closing stock is given in trial balance it is shown in Assesst side of Balance Sheet, while if closing stock is given in'Adjustments' then it is shown in credit side of Trading a/c as well Asset side of balance sheet
Can the payables be written off after one year?
Yes, payables can be written off after one year if they are deemed uncollectible or if the company has determined that the obligation is no longer valid. However, the specific policies for writing off payables may vary based on accounting standards and regulations. It's essential to ensure that proper documentation and justification are in place to support the write-off. Additionally, consult with an accounting professional to comply with applicable laws and financial reporting requirements.
Is Accounts Payable considered a debit on the Trial Balance?
No, it is a Credit because Accounts payable is a Liability account.
Is expense account a debit or credit account?
Expense account is a debit account.
So for example the expense is rent paid, so every year the rent expense increases and we record it in the debit side of the rent payable account and to complete the double entry, credit the same amount to the profit and loss account.
Follow this basic rule to know which side your looking for: DAXP (debit side items), LICS (credit side items)
D: drawings A:assets X:expenses P:purchases, L:liabilities I:income C:capital S:sales.
So DAXP items increase in the debit side while LICS items increase in the credit side.
How do you double entry when your debtor has paid your creditor for you?
credit the debtor and debit the creditor
Why is it necessary for accountants to assume that business entity will remain a going concern?
It is a basic assumption that the owners of the business would like to stay in the business. Hence Accountants prepare the books on the same premise.
How does current assets and current liabilities work together?
Current liabilities are the source of creating creating current assets. Current assets bring in cash to meet the current liability. Thus they represent the short term sources and short term uses.
