Accounts payable, abbreviated as A/P or just payables, refer to the unpaid bills of a firm. That is, the short-term debt a business owes to its suppliers and other creditors, and which must be paid off typically within a year (sometimes within a month or less) in order to avoid default. The sum of the amounts owed to suppliers is listed as a current liability on balance sheet.

Using the accrual basis of accounting, expenses are usually recorded in the accounting books (cash disbursements journal) at the time of payment for goods or services. If a firm buys on credit, expenses will be recorded in the purchase journal. If a firm deals with a specific supplier or group of suppliers on a monthly basis, there will be no need for it to record every transaction. Instead, it can add up all bills for the month payable to a given supplier and record one transaction in the journal at the end of a respective month. Furthermore, each supplier must be assigned a separate accounts payable ledger account (which is a record of what is owed to each seller or supplier), so that expenses recorded in the cash disbursements journal are posted, at the end of each business day, to their respective accounts payable ledger.