When the accounts payable department posts a liability:

Question

Quizplus · Accepted Answer

The recognition of a liability by the accounts payable department could be linked to the acquisition of goods or services for which payment has not been made yet. Consequently, this recognition could be linked to either the acquisition of an asset or the incurrence of an expense, depending on the nature of the transaction. For instance, if the purchase is made for inventory, then an asset will be recognized and if it is made for rent, then an expense will be recognized.

When the Accounts Payable Department Posts a Liability