Accounts payable is an example of which kind of account?

Accounts payable represents a company’s obligation to pay off a short-term debt to its creditors or suppliers. It is classified as a liability account because it signifies amounts owed for goods or services that have been received but not yet paid for. This means it reflects the company's debts or liabilities that it is required to settle in the future, typically within a year.

Understanding accounts payable as a liability is crucial for assessing a company’s financial health. It contrasts with asset accounts, which reflect resources owned by a business. Furthermore, capital accounts concern the equity stake of the owners and revenue accounts track income generated by business activities. Thus, recognizing accounts payable as a liability account helps in accurate representation of a company’s obligations and supports effective financial management and reporting.