what catergorie does accounts payable belong to? income statement or statement of changes in owner equity or balance sheet. im not sure but i think balance sheet.
Correct! Accounts payable is a category that belongs to the balance sheet.
To understand this, let's break down the three financial statements you mentioned:
1. Income Statement: This statement represents a company's revenues, expenses, gains, and losses over a specific period. It shows the financial performance of a business by displaying the net income or net loss. Accounts payable does not directly impact the income statement as it focuses on expenses and revenues.
2. Statement of Changes in Owner's Equity: This statement tracks the changes in the owner's equity (also known as shareholder's equity or capital) over a specific period. It reflects how the company's equity is affected by investments, profits, losses, and other equity-related transactions. Accounts payable does not impact owner's equity directly.
3. Balance Sheet: This statement provides a snapshot of a company's financial position at a specific point in time. It includes assets, liabilities, and owner's equity. Accounts payable falls under the category of liabilities on the balance sheet because it represents the money owed by a company to its suppliers or creditors.
Therefore, accounts payable can be found on the balance sheet under the liabilities section.