Accounts receivable is a term used to refer to the money that a company is owed by its customers for goods or services that have been provided on credit. This money is owed to the company and is usually expected to be paid within a certain period of time. Accounts receivable is typically reported on a company’s balance sheet as an asset.
Accounts payable is the opposite of accounts receivable. It refers to the money that a company owes to its suppliers or creditors. Accounts payable are usually reported on a company’s balance sheet as a liability. The company pays these amounts at a later date, usually within 30 days.