Notes payable may be issued to creditors to satisfy accounts payable created earlier.

Name: Notes payable may be issued to creditors to satisfy accounts payable created earlier.
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Question

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Notes payable are often issued to creditors as a way of satisfying accounts payable that were created earlier. This allows the company to convert its short-term liabilities to long-term liabilities and potentially obtain better financing terms.

Notes Payable May Be Issued to Creditors to Satisfy Accounts