Accounts payable
In accounting, accounts payable means what we owe vendors for bills already received.
- Layer
- Lexicon
- Defined in
- Lexicon
- Also called
- AP
- Components
- 2
Authority
This definition follows ASC 405.
Every citation in this system, with the text we read and the date we checked it, is in US GAAP and where these rules come from.
The lesson that teaches this
Accounting, 0 to 1 — a free course taught end to end on one month of one company, with the spreadsheet exercises to work it yourself.
Accounts payable, in use
Quoted from the 10 documents that use the word — what it does to an interface, in the spec's own sentence.
AP is where fraud happens and where controls matter most.
What it does that matters: banking, cards, AP, and expense in one platform with the accounting integration treated as a first-class surface rather than a settings page — sync status, mapping, and errors are visible product, not configuration.
Summary: primitives → the money proof → the ledger core → the table → statements → the close → AR → AP → payments → swaps → dashboard → consolidation → polish.
For founders
The same idea written for a founder: what it costs a startup that ignores it, and what to do in a real month.
- Accounts payableBills from vendors you've received and approved but haven't paid yet. It's a liability.
- Accounts payable process for startups: intake to paymentHow a bill moves from inbox to paid: intake, coding, approval, scheduling and recording, plus AP aging and who approves what at a 10-person startup.
- Accrued expenses vs accounts payable: the differenceAP is a bill you’ve received; an accrued expense is a cost incurred before the bill arrives. When to accrue, and how reversing entries work, by example.
- What to put on an invoice: a field-by-field guideThe fields a B2B invoice needs to get paid on time: legal names, a numbering sequence, dates, terms, tax lines, PO and remit-to, and how to fix one.
What it is not called
Each of these is a real word for a different thing. Using it here is what makes a product read as though it was built by someone who has not done the work.
- creditors
- payables unqualified in mixed context
Components that render this
The concept is not documentation-only. These are the components that name it in their specification, grouped and stated exactly as the catalog states them.
Also in Foundations
Work with this concept
The calculators that compute it and the ledger payloads that carry it. A definition is where a reader starts; these are where they go next.
- Duplicate paymentsSame vendor, same amount, close in time — plus the same reference whatever the date.Tool
- Payment terms & due dates2/10 net 30 is borrowing at 37% a year. This tells you whether to take the discount.Tool
- Accounts payable vs accounts receivableAccounts payable is money the company owes to its suppliers; accounts receivable is money its customers owe it — a liability on one side of the balance sheet and an asset on the other.Compare
- Accrued expenses vs accounts payableAccrued expenses are costs incurred that no bill has arrived for yet; accounts payable are bills received and approved but not yet paid — both are liabilities, separated by whether the vendor's invoice exists.Compare
- Journal entry for accounts payableWhen an approved vendor bill is entered, debit the expense or asset it bought and credit Accounts payable. When it is paid, debit Accounts payable and credit Cash.Entry
Defined in Lexicon. This page is generated from that document, so the two cannot disagree.