What is Account payable and Account receivable in ERP?

Question

Accepted Answer

Account payable and Account receivable are financial terms used in ERP systems.

Account payable refers to the money that a company owes to its suppliers or vendors for goods or services received but not yet paid for.
Account receivable refers to the money that a company is owed by its customers or clients for goods or services provided but not yet received payment for.
In ERP systems, account payable and account receivable modules help track and manage these financial transactions.
Account payable module in ERP allows recording and tracking of invoices, purchase orders, and payments to suppliers.
Account receivable module in ERP allows recording and tracking of invoices, sales orders, and customer payments.
These modules provide insights into the company's financial obligations and receivables, helping with cash flow management and financial planning.
For example, in an ERP system, a company can generate reports to see outstanding payments to suppliers (account payable) or outstanding payments from customers (account receivable).

Accepted Answer

Accounts payable (AP) ledger lists its short-term liabilities — obligations for items purchased from suppliers, for example, and money owed to creditors. Accounts receivable (AR) are funds the company expects to receive from customers and partners.

What is Account payable and Account receivable in ERP?

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