Utilities payable definition
/What is Utilities Payable?
Utilities payable is the amount owed to suppliers for electricity, gas, Internet connections, telephones, and water. The utilities payable account is used when an organization wants to separately identify this type of liability, typically because the amount is substantial. It may choose to instead record utility bills in its accounts payable account, which contains all trade payables.
Presentation of Utilities Payable
Utilities payable is considered a current liability, since the amounts owed are typically payable in much less than one year.
The Difference Between Utilities Payable and Utilities Expense
Utilities expense is not the same as utilities payable. Utilities expense is the year-to-date or period-specific cost of utilities, while the payable is just the unpaid amount of utility bills. Thus, the utilities expense is usually much higher than the utilities payable balance. This is especially the case if a number of months have gone by since the start of the year, during which a number of utilities invoices were paid.