creditor

(noun)

A person to whom a debt is owed.

Related Terms

Examples of creditor in the following topics:

  • Liquidation

    • Liquidation may either be compulsory (sometimes referred to as a 'creditors' liquidation') or voluntary (sometimes referred to as a 'shareholders' liquidation', although some voluntary liquidations are controlled by the creditors) .

  • Accounts Payable

    • Accounts payable is money owed by a business to its suppliers and creditors and typically shown on its balance sheet as a current liability.
    • Accounts payable (A/P) is money owed by a business to its suppliers and creditors.

  • Fundamental Concepts in Accounting

    • Is useful to existing and potential investors and creditors and other users in making rational investment, credit, and similar decisions;
    • Helps existing and potential investors and creditors and other users to assess the amounts, timing, and uncertainty of prospective net cash inflows to the enterprise;

  • Classifying Liabilities

    • Other long-term obligations, such as bonds, can be classified as current because they are callable by the creditor.
    • If a particular creditor has the right to demand payment because of an existing violation of a provision or debt statement, then that debt should be classified as current also.

  • Current Ratio

    • Financial ratios may be used by managers within a firm, by current and potential shareholders (owners) of a firm, and by a firm's creditors.
    • The ratio is an indication of a firm's market liquidity and ability to meet creditor's demands.

  • Using the Receivables Turnover Ratio

    • Finally, the average creditor payment period can be calculated as follows:

  • Characteristics of Bonds

    • In finance, bonds are a form of debt: the creditor is the bond holder, the debtor is the bond issuer, and the interest is the coupon.
    • Bonds and stocks are both securities, but the major difference between the two is that stockholders have an equity stake in the company, whereas bondholders have a creditor stake in the company.

  • Business Stakeholders: Internal and External

    • Creditors want to be repaid on time and in full.

  • Introduction to GAAP

    • Useful to present to potential investors and creditors and other users in making rational investment, credit, and other financial decisions.
    • Helpful to present to potential investors and creditors and other users in assessing the amounts, timing, and uncertainty of prospective cash receipts.

  • Bonds Issued at Par Value

    • The affected accounts will be interest expense and cash, and the journal entry will be as follows: Interest Expense $70 Cash $70At bond expiration, the creditor must make a journal entry for the last interest payment and the retirement of the bond through principal payment.