SUNDRY CREDITORS
Any person who supplies the goods or services or consumable items to a business firm on a credit basis will be called a sundry creditor by the firm who avails this facility. The suppliers of various items relating to expenses on a credit basis are also called sundry creditors.
Sundry creditors are the liabilities of the firm because the firm is supposed to pay the outstanding amount in the future as per terms and conditioned agreed upon by both parties. They are called trade creditors also. But at the time of preparing the final accounts, the amount payable to the creditor is shown as sundry creditors.
What is Accounts Payable?
Accounts payable means the amount to be paid against goods or services. These are called sundry creditors or sundry suppliers also.
This is a very important duty of the finance department to arrange money for suppliers in time because if they are not able to pay them in time then the supplies of goods are affected and it will be very difficult to meet the demand of customers also. So, one should be very careful to deal with the payment of suppliers.
Points to be remembered in respect of the payment to suppliers: - Following points must be kept in mind while dealing with the suppliers: -
1. The payment of dues must be made in time as far as possible to maintain the goodwill of the firm.
2. The purchase department must make sure that the goods are not purchased in more than the required quantity.
3. There should proper coordination between the purchasing department and the finance department.
Treatment of Sundry Creditors in Final Accounts
Sundry creditors are shown in the balance sheet on the liability side.
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