Questions and Answers
Where are items classified within the accounts payable recorded?
As liabilities in a ledger
How are wages and payroll processed in relation to accounts payable?
Wages are processed separately in the payroll system
What expenses are generally included in accounts payable?
Travel expenses and raw materials
What is the responsibility of accounting and finance teams regarding accounts payable?
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Study Notes
Accounts Payable Classification
- Items are classified within the accounts payable as current liabilities on the balance sheet.
Payroll Processing
- Wages and payroll are processed separately from accounts payable, with payroll expenses being recorded as a separate current liability.
- However, if payroll taxes or benefits are still owed to vendors, they may be recorded as part of accounts payable.
Accounts Payable Expenses
- Accounts payable generally includes expenses such as:
- Purchases of goods or services from suppliers
- Utilities
- Rent
- Insurance premiums
- Office supplies
Responsibility of Accounting and Finance Teams
- The accounting and finance teams are responsible for:
- Processing and paying invoices to suppliers
- Managing and maintaining accurate records of accounts payable
- Ensuring timely payment of invoices to avoid late fees and penalties
- Maintaining a good credit score by making payments on time
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