In business, many suppliers grant their customers a type of credit referred to as accounts payable, which allows customers to pay for product or services after they have been received. "Accounts payable invoices" refer to documents that record amounts owing to suppliers for goods for a business. When an invoice is received but not paid, it is considered an accounts payable invoice. Once the invoice has been paid, it is removed from the file and recorded as an expense.
Uses for Accounts Payable Invoices
Accounts-payable invoices are used to record and track financial amounts owing to suppliers for specific supplies and services. The invoice is placed in an "accounts payable" file signifying that money is owed and removed from the file when the amount has been paid. Often businesses record the transactions in their ledgers after the accounts payable invoice has been completed. In business, accounts-payable invoices are used for short-term debt that is paid once the product or service is received. Long-term debt such as lines of credit, real estate mortgages and vehicle leases are categorized and recorded differently.
Accounts Payable Invoices in the Household
Households use accounts payable invoices and files for household bills. In the home, an accounts payable file would be set aside and all monthly bills to be paid manually would be placed in this file as accounts payable invoices. The bills would then be filed into the family's yearly paperwork once paid. Accounts payable invoices in the home are bills such as electric company bills, telephone bills, television and internet bills, newspaper subscriptions and other monthly costs. Keeping track of bills such as electric company bills, telephone bills, television and internet bills, newspaper subscriptions and other monthly bills paid manually.
Information to Look For in Accounts Payable Invoices
When receiving an accounts payable invoice it is best to review all the data on the invoice making sure it is accurate. Double check all information against the products or services received from the company that issued the invoice. Information to look for includes; the number of the invoice, the date the invoice was created, the date the invoice is billed for, who the invoice was billed to, what products or services were included in the invoice, the quantity and costs of these products or services, the type and cost of shipping, where the products or services were shipped to, the account payment is to be sent to, your customer number, the subtotal and taxes included in the invoice, and the supplier's information.
Tips for Accounts Payable Files
Develop a set system for receiving and filing invoices and record the method to teach to all employees. For businesses, it is critical that all paperwork and files are consistent. Having a manual of how to receive and file paperwork associated with accounts payable invoices helps employees correctly receive your products, make the payments, and file the paperwork correctly every time. Have a "fact checker" assigned to double-check the accounts paperwork before finalizing it in your files. This helps ensure that nothing is overlooked when you are billed and avoids you paying for items you didn't receive. Scan all accounts payable invoices into an electronic database that is kept separate from your computer. File away the paperwork and refer to the electronic copy in future, helping to preserve the original copy and reduce the amount of paperwork cluttering your office space.
Based in Oshawa, Ontario, Samantha Hadley began writing business-related articles in 2008, authoring a construction blog. She has also published features in the “Durham Chronicle” newspaper and the “Toronto Downtown Jazz Newsletter.” Hadley holds a diploma in print journalism from Durham College.