---
title: "Accounts receivable"
description: "What is accounts receivable (AR)? Money customers owe for goods or services invoiced on credit. Learn how AR works, how to manage it and why it isn't revenue."
url: https://1flux.ai/glossary/accounts-receivable
last_updated: 2026-10-10
---

[Accounting](https://1flux.ai/glossary#accounting)

# Accounts receivable

What is accounts receivable, and how is it different from revenue?

Glossary Updated 10 October 2026

Definition

Accounts receivable (AR) is the money customers owe a business for goods or services already delivered and invoiced on credit.

## What is accounts receivable in practice?

AR is an asset on the balance sheet and, for most B2B traders, one of the largest. It grows when you invoice on credit and falls when customers pay. Managing it means invoicing promptly, applying payments to the right invoices and chasing overdue balances.

Example: a distributor issues USD 320,000 of invoices in May on 60-day terms; until customers pay, that amount sits in AR.

Days sales outstanding (DSO) measures how quickly AR turns into cash, and [AR aging](https://1flux.ai/glossary/accounts-receivable-aging) shows which balances are overdue. AR isn’t the same as revenue: revenue is recognised when you invoice, and the cash arrives later.

In 1flux

Sales invoices post the receivable automatically, customer payments clear it and the Receivables page ages balances and reconciles open invoices to the AR control account. [See receivables and receipts](https://1flux.ai/products/accounting/receivables)

Related

## Keep exploring

### [Accounts receivable aging](https://1flux.ai/glossary/accounts-receivable-aging)

Unpaid customer invoices grouped by days past due.

### [Credit days](https://1flux.ai/glossary/credit-days)

How many days a customer has to pay, from a set starting date.

### [Accounts payable](https://1flux.ai/glossary/accounts-payable)

Money you owe suppliers for goods or services invoiced on credit.

### [Receivables and receipts](https://1flux.ai/products/accounting/receivables)

Apply payments across invoices, age every balance and prove the total against the ledger.

Last updated 10 October 2026