What accounting term describes money a business owes to suppliers?

What accounting term describes money a business owes to suppliers? The term is accounts payable.

Accounts payable, commonly abbreviated AP, records a company's unpaid short-term obligations to suppliers and vendors. These obligations usually arise when a business receives goods or services before paying the related invoice. On the balance sheet, accounts payable appears as a current liability when payment is expected in the near term.

The process typically begins with a purchase order or supplier agreement. After delivery, the business checks the goods or services, reviews the invoice, records the amount in its accounting system, and pays according to the agreed terms. Efficient accounts-payable work helps a company avoid late fees and maintain good supplier relationships.

Accounts payable is often confused with accounts receivable. Payable is money the business owes to others; receivable is money customers owe to the business. It is also different from notes payable, which generally involves a formal written debt instrument rather than ordinary supplier invoices.