Accounts Payable With Aging Template is a ready-to-use template in Excel, Google Sheets, and OpenOffice Calc that provides details of outstanding payables.
The Accounts Payable Template is useful for Accounts Assistant, Accountants, Audit Assistants, etc.
What is Accounts Payable?
Accounts Payable Template is a document that records invoices of goods purchased by us on credit. In other words, our creditors whom we are liable to pay them during a specific time.
All kinds of Payables are a liability for the company and the business records them in the current liabilities section. Hence, Accounts Payable is a short-term debt that needs to be paid off to avoid default.
Normally, Accounts Payable is a credit balance. When you record a vendor invoice, you will credit Accounts Payable and debit another account as per the double-entry accounting system.
Simultaneously, when you pay your Accounts payable, you will debit Account payable and credit Cash. Therefore, the credit balance in Accounts Payable should be equal to the unpaid vendor invoices.
Accounts Payable is not a term that is used only in businesses. Even individuals like you and me have Accounts Payable.
For example, we consume electricity, telephone, broadband, cable TV, etc services. These companies generate the bills towards the end of a particular billing period.
It means that the service provider gives us some service on credit. We need to make the payment of these services on a certain date or else you will default. This is our Accounts Payable.
What is Accounts Payable Aging Report?
Accounts payable aging report shows the creditor’s balances. you owe. Moreover, it consists of details of how much you owe, and how long you’ve owed debts.
Account Payable consists of invoices of inventory, supplies, services, etc that business purchases carry on their operating activities.
Components of Accounts Payable Aging Report
The first column will display the names of your suppliers. The next column consists of the invoice details. These include invoice date, invoice number, and payment date. In addition to that, it consists of payment details such as the payment date and payment amount.
Followed by the above, the report consists of the aging section. Each column represents a time frame by calculating the days according to date and payment terms. Usually, an aging report uses a 30-day increment system.
You need to define columns that will display the outstanding amount of the respective time frame. These columns may include the following depending on your requirement:
- Current Outstanding (0 to 30 days old).
- Outstanding Amount Past Due Date 1-30 days.
- 31 to 60
- 61 to 90
- Over 90 days
Importance of Accounts Payable Aging Report
Aged Creditors Report or Accounts Payable Aging Report is a tool that helps to monitor the age of outstanding payables of the company.
This AP aging report helps the business to take timely actions to ensure good relations with suppliers/vendors. Furthermore, this reduces the liability of the business.
Moreover, early payments to vendors will help the business to get early settlement discounts. This report is also helpful to predict the Cash Flow requirements of the future.
Accounts Payable With Aging Template
I have created an Accounts Payable Template with advanced functions. With Accounts Payable Template you can efficiently and easily record entries. This template generates a vendor wise/creditors wise report in few clicks.
Note: To edit and customize the Google Sheet, save the file on your Google Drive by using the “Make a Copy” option from the File menu.
Let’s discuss the template contents in detail.
Contents of Accounts Payable With Aging Template
This template consists of two sections: Header Section and Data Input Section
In the Header section, the right-hand side consists of the Company name and name of the Ledger of Accounts Payable.
On the left-hand side, the Balance of Accounts Payable amount as of today’s date is given. Thus, Balance amount = Total of Invoices – Payments.
The date column will automatically take the current date of the system. Current date formula =Today() is given.
Data Input Section
The data input section consists of the following subheading for data entry of payable invoices:
Invoice Date: Date of the invoice issued by Creditor
Invoice #: Invoice number of the Creditors.
Supplier Name: Name of Creditor’s company or individual.
Invoice Amount: Amount of invoice in the desired currency.
Payments made: Record amount if any amounts are paid.
Amount: This column shows the balance amount after deducting payments from the total amount of invoice. The formula here is =D5-E5.
Due Date: Due date is the last date for making payment to the creditor.
Days Above Due Date: This column shows the number of days that pass the due date. If the due date has not yet arrived it will show “NOT DUE”.
I have added a formula with an IF Statement here.
Formula: =IF(TODAY()-G5<=0,”NOT DUE”, (TODAY()-G5))
Remarks: Here you need to enter remarks as and when required for any disputes or discrepancies.
The last line consists of the totals, where simple column totals are given using the SUM formula.
All the subheadings in the data input section are created with a table. Thus, it allows you to generate a creditor wise, date wise, etc query/report as required.
You need to simply click on the drop-down button in a subheading and select the criteria of the report.
Other Account Payable Templates
Simple Accounts Payable Template
Accounts Payable Template With GST
Accounts Payable Template With VAT
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Frequently Asked Questions
What Is the Accounts Payable Turnover Ratio?
Accounts payable turnover ratio is a measure that a business uses to quantify the rate of paying off its suppliers. It refers to the number of times a company pays off its accounts payable during a specific period.
What Is the Formula to Calculate Accounts Payable Turnover Ratio?
Total Supply Purchases
(Begining Accounts Payable Balance + Ending Accounts Payable Balance)/2
What is the average payment period?
The average payment period refers to the number of days a company takes to pay off its credit purchases. The formula to calculate the average payment period is “accounts payable / (total annual purchases / 360)”.
Difference between Accounts Payable Aging and Accounts Receivable Aging.
- Accounts Payable Aging is your liability whereas the Accounts Receivable Aging is your Asset.
- AP refers to the money your business owes to others whereas the AR refers to the money others owe to your business.
Is a higher payment period good for Accounts Payable?
From a financial point of view, the higher payment period for Accounts payable is good. It provides the business to utilize the available cash in a better way to maximize the benefits.
On the contrary, it hinders your relationship with your suppliers which can cause problems in the timely supply of goods or services. It also makes your suppliers question your ability to pay.