By Leanna Kelly When evaluating a company’s current financials, accounts payable is an important figure to consider. What is accounts payable (AP)? It’s a summary of current debts owed to vendors and suppliers. Depending on how you look at it, AP represents upcoming due, a short-term loan and/or obligations to partners. Regardless of perspective, it’s easily summed up in one word: liabilities. This is what a business owes.
Accounts payable factors heavily into cash flow, since it represents the outflow of funds. As such, its advantageous for companies to prolong this outflow. This is often a double-edged sword: companies have more cash on-hand …read more
