Why use Accounts Payable

Many people say “why use accounts payable? Why not just write a check?”

First of all the key difference is the date. QB reports will expense the transaction as follows:

In Accounts payable it will use the bill date. (regardless of the date the bill was paid) With just writing a check it will use the check date.

Here is an example: say you have a utility bill at the end of the January and it is due in 10 days. You enter the bill dated January 31st and it is expensed in January’s books. If you skipped that step and just wrote a check dated Feb 10th then the expense shows up in February’s books.

So keep that in mind when you pull up a p&l and it shows a really large utility expense, click to drill down and see if you have bills dated in the same month. Simply change the date so that it lands in the correct month.

Remember using accounts payable, it doesn’t matter when the actual check is printed, it is important that you date the bill correctly. On that same note it doesn’t matter what you enter for due date that simply helps organize the bills to be paid and has no effect on when the expense is recorded.