What is account receivable and accounts payable

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Accounts receivable is the money owed to a company by its customers, while accounts payable is the money a company owes to its suppliers.

Accounts receivable refers to the outstanding invoices or money owed to a company by its customers for goods or services provided.
Accounts payable refers to the outstanding invoices or money that a company owes to its suppliers or vendors for goods or services received.
Accounts receivable is an asset on the company's balance sheet, representing the amount of money that is expected to be received in the future.
Accounts payable is a liability on the company's balance sheet, representing the amount of money that is owed and needs to be paid in the future.
For example, if a company sells products to a customer on credit, the amount the customer owes becomes accounts receivable for the company until it is paid.
On the other hand, if a company purchases raw materials from a supplier on credit, the amount the company owes becomes accounts payable until it is paid.

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