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Financialaka: APaka: payables

Accounts Payable

In Plain English

The money a company owes to its subcontractors and suppliers for work already done but not yet paid.

Definition

Accounts payable (AP) in construction represents the amounts a contractor or owner owes to subcontractors, suppliers, and vendors for goods and services received but not yet paid. Managing AP efficiently protects subcontractor relationships, avoids mechanics lien filings, and maintains cash flow. AP aging reports show outstanding invoices categorized by the number of days past due.

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