Accounts payable is best described as what?

Accounts payable refers to the amount a company owes to its suppliers or vendors for goods and services that have been received but not yet paid for. This liability represents a fundamental aspect of a company’s financial obligations and is key for understanding a company's cash flow and working capital. When a business purchases inventory or services on credit, it records these transactions in accounts payable until payment is made.

Given this definition, it is clear that option C accurately captures the essence of accounts payable as a liability indicating amounts owed to suppliers. Properly managing accounts payable is crucial for maintaining good supplier relationships and ensuring the business has sufficient liquidity to meet its short-term obligations.

The other options do not align with the definition of accounts payable. Describing cash on hand pertains to assets, while total assets reflects the entirety of what a company owns, and income generated from sales is related to revenue, none of which directly relate to the concept of obligations owed to suppliers.