What Is an Accounts Payable

question 10

Multiple Choice

What is an accounts payable?

• A)Amounts a customer owes our business from a credit sale where the customer promises to pay later.
• B)Amounts our company has already payed to our vendors.
• C)Amounts our business is obligated to pay in the future.
• D)Amounts our company must return to our vendor if discounts are not granted on our purchases.

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Definitions:

Daily Closing Balance

The total amount of money in an account at the end of the trading day, reflecting all transactions processed that day.

Simple Interest Rate

A method of calculating interest where the interest charge is based on the original principal only.

Payments

Transfers of money in exchange for goods or services or as fulfillment of obligations under a contract.

Agreement

A mutual arrangement, typically in writing, between two or more parties detailing the terms and conditions of a deal or partnership.