Accounts Payable

So, for example, accounts receivable.

Accounts Payable is a liability

So you have accounts receivable of 400

So we have an increase in accounts receivable.

This check is payable to the bearer.

It is payable without means tested verification

I thought a bit. Payable in advance?

Payable to the City of San Francisco.

So let me add Accounts Payable over here.

Checks should be made payable to the ABC Company.

So we have an Accounts Payable increase of 100.

It's for 50 may payable to Mr Ian Steel .

So you have an Accounts Payable liability of 100 sorry, at this point we had no Accounts Payable liability and then after the end of the month we have an Accounts Payable liability of 100.

So over here we have a net change in accounts receivable.

AR is short for accounts receivable, just to save some space

We're assuming nothing shady is happening with the Accounts Payable,

That means that you've increased your Accounts Payable by 100.

Accounts Receivable, that they're not changing over the course of the year.

When they pay you the 400, it goes from accounts receivable to cash.

He had this 5,000 dollars in accounts payable, also depicted over there.

When I saw that, I got worried, so I checked Accounts Receivable on other customers.

Increasing the Accounts Payable is allowing us to not use all of our cash

A certified check for 6500 payable to Thomas Crailer, and signed by F.T. Latimer.

They'd even make the cheque payable to your pen name, if you had one.

And the only liability that Ben's shoe company had was this 5,000 in accounts payable...

Hunt up your cheque book and see how many cheques for ten pounds payable to the Ritz

It's listed as a current asset on this balance sheet but the invoice was never presented to accounts receivable, so....

And going into the period, you didn't have any Accounts Payable, and then now that you're essentially borrowing 100 from your vendors, you're allowing to push back when you pay them, you now have an Accounts Payable of 100. and I'm not going to work it through on all of this stuff over here.

Now, with cash basis, you would have added that to your revenue, but here, we already accounted for it in the accounts receivable, we already took that revenue.

So let me erase that and then let's add a line right over here so we can say Accounts Payable increase and now this is a source of cash.

But I have an accounts receivable of 400, so my total assets now are 300 of assets, remember, accounts receivables aren't assets, because someone owes me something, someone owes me cash in the future.

Now this will change your cash accounting numbers, this will now be 100, and this would now be 500. but the more important thing is how this can be accounted for in Accounts Payable.

And we had no other changes, we haven't even addressed accounts payable, that's essentially pushing back, owing people, paying other people, paying your vendors money, but I don't even address that in the previous example.

The way that you account for that, is on your balance sheet, you say that you are essentially owed 400, so this accounts receivable this is essential stuff that other people owe you, you need to receive this from other people, but it's an asset, other people have an obligation to you

So let's just think about it, when you have an increase in account receivable, you're kind of letting people owe you money you're letting people owe you 400 if you didn't let them owe you, that would have been cash, so you're kind of pushing back the time that you're getting cash.

Also, it is not a sin if you divorce your wives before the consummation of the marriage or the fixing of the dowry. But the dowry will be due from a husband whether he is rich or poor. It is payable in a reasonable amount according to the husband's financial ability. This is an obligation for the righteous ones.

I will try to do proportional to the size so that right over there, that is the accounts payable the five thousand dollars. they both have that on the liability size now where they really diverge so this is the same amount 5 thousand dollars it should be about 1 4 of the size its not exactly how I've drawn it but where they really diverge is that Jason