What is ‘payable to a supplier’? First I would like to define the term ‘supplier’. In practice for some reason it creates some confusion and I have seen often enough some people thinking you sell your goods to your supplier. Whilst this may happen, it’s a case your supplier becomes your client at the same time. ‘Supplier’ is someone you buy goods and/or services from; they supply you with goods and/or services you require. For argument purposes, your ‘customer’ is someone who buys goods and/or services from you. So now that’s clear we can move on. 

A ‘payable’ in a company’s accounts is a balance the company owes to its supplier. Under normal conditions you would first get the goods, the service and you would be invoiced (i.e. you get an invoice with the payment date sometime in near future). In such case you encounter a situation where you owe for something you already obtained and as this what you obtained, is put into use or is your risk now (risks and rewards have transferred), you should also recognize the fact that you still need to pay for it within your company’s accounts.

This ‘something you have to pay’ is in fact the ‘payable’ part of the ‘payable to a supplier’ so there you have it. A payable to a supplier is an amount you owe to a party you bought goods and/or services from.