Accounts Receivable and Accounts Payable denote the two sides of a company’s financial transactions with its clients, vendors, and customers. As the names imply, Accounts Receivable refers to the money owed to a business by its customers, while Accounts Payable represents the money that a business owes to its suppliers, vendors, or other creditors. In other words, Accounts Receivable involves incoming funds while Accounts Payable involves outgoing funds. Put simply, Accounts Receivable is what your company will receive in the future; Accounts Payable is what your company needs to pay out. It’s important to keep track of both in order to ensure that your business has the resources it needs to stay solvent and profitable.