Explanation
Accounts payable are recorded as current liabilities and managing them wisely can:
- Preserve working capital
- Build stronger supplier relationships
- Unlock early payment discounts
Best practices include:
- Negotiating longer payment terms
- Maintaining good vendor communication
Practical Example of Accounts Payable
A restaurant receives a £2,000 produce delivery on credit, agreeing to pay within 14 days. This amount is recorded as accounts payable until payment is made.
How Bizcap Can Help:
Facing tight cash flow but need to keep suppliers happy? Bizcap’s short-term loans help you meet obligations and maintain trust without stalling operations.