The following table specifies the differences between the “accounts payable (AP)” and “accounts receivable (AR):
|The term Accounts Payable specifies the amount a company owes because it has purchased goods or services on credit from a vendor or supplier.
|The term Accounts Receivable amount a company has the right to receive because it has sold goods or services on credit to the customer.
|Accounts payable is a form of liability.
|Accounts receivable is a form of asset.