Trade Payable Closing Balance Formula

Trade Payable Closing Balance Formula

Trade payable closing balance can be calculated by the following formula.

Closing balance = Opening Balance + Credit Sales –Cash received

Example

Opening Balance of Trade payable = 20,000

Credit Purchases during the Period = 50,000

Cash Paid during the Period = 10,000

What would be Closing Balance?

Solution

Closing balance = Opening Balance + Credit Purchases – Cash Paid

=20,000+50,000-10,000

=60,000 (Closing Balance)