AR and AP, or Accounts Receivable and Accounts Payable, are two common terms in the world of business accounting. AR refers to money that is owed to your company by customers, while AP refers to money that your company owes to suppliers and other creditors. Understanding how these concepts integrate into your business financials is essential for maintaining positive cash flow and staying profitable. In essence, AR is the money that’s coming in, while AP is the money you’re paying out. Keep them balanced, and your business will be rewarded!