Accounting term definition

[avin]

Hey guys,

What is the meaning of bill payable and Account payable? What are the differences between two of them?
Thanks.

[$tyli$h Executive]

Found these from another website:

Accounts payable: A debtor's accounts of money he owes; normally arise from the purchase of products or services.

& Bills payable: Bill means (An itemized statement of money owed for goods shipped or services rendered). The outstanding bills (like for instance utility bills etc) yet to be paid.

--------------------------------------

Accounts payable refer to the current liability of a business or an organization. That is the unsettled payments in a business or an organization refers to Accounts payable. Bills payable refers to bills settled. In other words the paid and accepted recorded bills in a business or an organization refers to bills payable

-------------------------

Accounts payable: A debtor's accounts of money he owes; normally arise from the purchase of products or services.

& Bills payable: Bill means (An itemized statement of money owed for goods shipped or services rendered). The outstanding bills (like for instance utility bills etc) yet to be paid.

[avin]

is it means that bill payable and account payable are actually the creditors of the business owner. The only different is that the amount owing is stated on the bill but how about account payable?

It is confusing for me.

[Alpha]

is it means that bill payable and account payable are actually the creditors of the business owner. The only different is that the amount owing is stated on the bill but how about account payable?

It is confusing for me.

Yes, both are creditors. Accounts Payable are creditors for the goods in which the business specialises, in case for retailing businesses, in merchandise.

[avin]

Alpha, how about bill payment?

[$tyli$h Executive]

Alpha, how about bill payment?

Of course bill payment is to creditors as well. Suppose you buy a computer for your business and are billed $700 (which can be paid in installments). The business selling computer is your creditor then.

[Alpha]

Yes, Bills Payables are creditors too.

By that, both Bills Payables and Accounts Payables will enter your Statement of Financial Position. The difference will be in your Income Statement; Accounts Payables will be included in your calculation for Purchases (in the Trading Account), while Bills Payables will appear as an expense (in the Profit and Loss Account).

In a strictly accounting sense, Accounts Payables refer to your trading activities, and Bills Payables to your operating activities, i.e. all the selling, administrative, and financial expenses incurred to bring about that trade.

I hope it's clearer...

~Good Day

[***exam***]

Yes, Bills Payables are creditors too.

By that, both Bills Payables and Accounts Payables will enter your Statement of Financial Position. The difference will be in your Income Statement; Accounts Payables will be included in your calculation for Purchases (in the Trading Account), while Bills Payables will appear as an expense (in the Profit and Loss Account).

In a strictly accounting sense, Accounts Payables refer to your trading activities, and Bills Payables to your operating activities, i.e. all the selling, administrative, and financial expenses incurred to bring about that trade.

I hope it's clearer...

~Good Day

good explanation alpha !  although i never knew they were two different things ! now i have a clear understanding

[Alpha]

good explanation alpha !  although i never knew they were two different things ! now i have a clear understanding

Np