Question

what is creditors ?​

Answer 1

Answer:

creditor or lender is a party that has a claim on the services of a second party. It is a person or institution to whom money is owed. The first party, in general, has provided some property or service to the second party under the assumption that the second party will return an equivalent property and service.

Answer 2

Answer:

Creditors are the persons/firms/companies etc. to whom money is to be paid by the business.

OR

The persons/firms/companies who provide goods/services to us on credit.

Explanation:

For example, Mr. A has the business of purchasing pens for Rs. 8 and selling them for Rs. 10 per unit.

Let's say he buys 100 pens from A company X, 50 from a company Y and 20 from another company Z.

Now, he is liable to pay

Rs. 100*8 = Rs. 800 to Co. X

Rs. 50*8 = Rs. 400 to Co. Y

Rs. 20*8 = Rs. 160 to Co. Z

This means, he is the debtor of the three companies or, the three companies are the creditors the creditors of Mr. A.