What is the difference between notes payable and accounts payable?
submitted by miranda

Jnco

First off, a "note" is a loan. So, your notes payable are all your loans you need to pay off. Accounts payable are other money you owe, like when you buy inventory on a payment plan, rather than paying cash.

Estelcelis

Notes payable are usually long term loan which include payment of principal and interest for a certain period of time. Whereas, accounts payable are the merchandise or supplies that are purchased to be used for the regular operation of business usually paid within short period of time or discounted if paid early based on term of the invoice.

petros degefa

note payble is a liability that must be paid off.
it will be obligated by the law.
it is a written promise.wheras account payble is aliability that will paid of in short period of time.

Tim

Notes payable are basically loans. It's a written, formal promissory notes that obligates a company to pay some amount by a certain date. This often involves interest. You usually see this when a business borrows money.

Accounts payable, on the other hand, are a little different. They're short-term liabilities for things like goods or services bought on credit. These are usually settled within a short period and do not involve a formal note or interest agreement.

To recap, a note is like a loan. Accounts payable can just be bills you haven't paid yet, like for 20 reams of paper that were delivered.

Rankjled

Notes payable are like IOUs where you promise to pay back money later, usually with interest. It's called a note because it's written down.

Accounts payable are just what you owe to your suppliers for supplies and other things you bought on credit. It's usually paid pretty quickly.

So, notes payable are more formal and often involve interest, while accounts payable are more like short-term bills.

nottoofast

Notes payable is how much you owe on loans. Accounts payable is how much you owe for smaller, short-term purchases like equipment or supplies.

Notes are a little more formal and long-term, like a loan that needs to be repaid in 12 months. By "formal," I mean that it's actually a written contract, hence the name "note."

Accounts payable covers less strict expenses. Say you're an electrical contractor and you buy a box of connectors from your supplier. They put it on your account and bill you later. That would be accounts payable.