Is Accounts Payable both a Debit & a Credit? - Accounting Questions Answered
Accounts payable is a liability account and has a default Credit side. Accounts payable is a promise made by company to pay for goods/services later. The credit balance in Accounts payable indicates the sum of money the company owes to suppliers or vendors.
Thus, accounts payable is credited when goods/services are purchased on credit because the liability increases. On the other hand, when a company makes a payment for items purchased on credit, this results in a debit to accounts payable (decrease).
Put in simpler terms, a credit to Accounts Payable will increase the liability account while a debit will decrease it.
Learn more about Accounting Debits & Credits.
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