SAP Business One Certification Practice Exam

In which drawer of the chart of accounts can accounts payables be found?

1. Assets

2. Liabilities

3. Equity

4. Revenue

The correct answer is: Liabilities

Accounts payables represent the obligations a company has to its creditors or suppliers for goods and services purchased on credit. In the context of the chart of accounts, which serves as a framework for recording financial transactions, accounts payables are categorized under liabilities. This is because liabilities encompass all financial obligations that a company must pay in the future, reflecting the company's debts and obligations. In the chart of accounts, the liabilities section specifically includes accounts payable, which indicates the amount owed to suppliers and vendors. Understanding this classification helps businesses manage their financial statements and cash flow effectively. By keeping accounts payables in the liabilities drawer, it provides a clear picture of what is owed and helps in assessing the overall financial health of the organization. The other categories—assets, equity, and revenue—do not encompass accounts payable. Assets represent what a company owns, equity reflects the owner's residual interest after liabilities, and revenue pertains to the income generated from normal business operations. Therefore, placing accounts payable under liabilities accurately reflects its nature as a financial obligation.