Asked by Chelsea Lewis on May 22, 2024
Verified
Paying an account payable increases liabilities and decreases assets.
Account Payable
Obligations or debts a company owes to suppliers or creditors for goods or services received that have not yet been paid for.
Increases Liabilities
Situations or transactions that result in a rise in the claims against a company’s assets.
Decreases Assets
Refers to any operation or transaction that results in a reduction of the value of assets owned by a business.
- Learn about the foundational parts and their relationships in the accounting equation (Assets = Liabilities + Owner's Equity).
- Recognize the difference between expenses and assets, and their impact on financial statements.
Verified Answer
CM
Cristian MelenaMay 24, 2024
Final Answer :
False
Explanation :
Paying an account payable decreases liabilities (as you are settling a debt) and decreases assets (as you are using cash or another asset to make the payment).
Learning Objectives
- Learn about the foundational parts and their relationships in the accounting equation (Assets = Liabilities + Owner's Equity).
- Recognize the difference between expenses and assets, and their impact on financial statements.