![]() ![]() At the end of the month, the account is debited to zero, and we credit cash to pay salaried workers. Salaries payable accumulates over the course of the month as employees work but are not paid. Big asset purchases usually require one up-front payment. Moreover, in theory, AP can also include amounts that fund long-term assets, but this is extremely rare. Any non-cash increases in inventory, therefore, are offset by increases in AP. When we increase inventory, some of this value may be recorded as AP. But AP doesn’t only include income statement expenses. When an expense, for example, is recorded on the income statement but we don’t disburse cash for it, then we record the value under accounts payable. Accounts payable are obligations Amazon has towards others.
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