Define: Trade Creditors

UK Accounting Glossary

Definition: Trade Creditors


Quick Summary of Trade Creditors


Persons who supply goods or services to a business in the normal course of trade and allow a period of credit before payment must be made.



What is the dictionary definition of Trade Creditors?

Dictionary Definition


trade creditor is a supplier who has sent your business goods or supplied them with services, who you haven’t yet paid.

Suppliers who are owed payment for raw materials or a product’s component parts by the manufacturer. In business accounting applications, trade creditors and the amounts owed are listed in the company’s balance sheet as liabilities.


Advertisement



Full Definition of Trade Creditors


A trade creditor is a supplier that provides goods and services to its customers on credit terms. The amounts owed are stated on the balance sheet of a customer as a current liability, and on the balance sheet of the trade creditor as a current asset. A trade creditor typically analyses the financial statements, credit reports, and payment histories of its customers when deciding how much credit to extend to them.

The amount that goes on your business’s balance sheet for trade creditors is the sum of all its unpaid invoices from suppliers, as at that point in time.


Advertisement



Trade Creditors FAQ's


Are trade creditors assets or liabilities?

Current liabilities are normally settled from the amounts available in current assets. The main element of this is normally “trade creditors” – amounts owed by a business to its suppliers for goods and services supplied. A trade creditor is the opposite of a trade debtor.


Cite Term


To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.

Page URL
https://payrollheaven.com/define/trade-creditors/
Modern Language Association (MLA):
Trade Creditors. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. January 21, 2020 https://payrollheaven.com/define/trade-creditors/.
Chicago Manual of Style (CMS):
Trade Creditors. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. https://payrollheaven.com/define/trade-creditors/ (accessed: January 21, 2020).
American Psychological Association (APA):
Trade Creditors. PayrollHeaven.com. Retrieved January 21, 2020, from PayrollHeaven.com website: https://payrollheaven.com/define/trade-creditors/

Definition Sources


Definitions for Trade Creditors are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • BusinessDictionary.com
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 23rd December 2018.