Accounts Payable
Accounts Payable is the money that a company owes to other companies and outside vendors for products and services. These are items that are purchased on a credit basis.What happens from the beginning is that Company A wants to purchase items from Company B, they fill out a credit application and once the application is approved they are set up for a net 30 account. This means that Company A can purchase as much or as little from Company B. Then when Company a receives the bill totally everything they bought for that billing cycle, they have 30 days to pay the bill or the amount due before they incur any late charges.
It makes accounting easier than buying everything with a check. You get a packing slip or a receipt every time you need something and you hold that paper and when you get the bill for that order you match it up with the invoice to make sure that you are paying for what you received. Then you pay the bills. It really is a simple concept. Accounts Payable and Accounts Receivable works hand in hand. As money is flowing into the company, money is being used to pay these Accounts Payable. It has a nice even balance.
A company may have an Accounts Payable Team or they may have one person who handles it. It would depend on the size of the company and the size of the purchases. Accounts Payable jobs are always available if you look in the paper. You don’t need an accounting degree , some companies require some experience but in itself is not a hard job. Accounts Payable is also an easy way to keep track of the companies finances better. By using checks you have to match the checks to the receipt and you end up with more paperwork than ever.