A credit score is a number that represents a person’s creditworthiness. Lenders use it to predict how likely someone is to repay a loan. A higher credit score makes it easier to get approved for loans, credit cards, or mortgages and often results in lower interest rates. A low credit score can make it difficult to borrow money or lead to higher interest rates.

A journal is the first place where a business records its financial transactions in chronological order. Think of it as a diary of all business activities. A ledger is a collection of accounts (like Cash, Sales, or Rent Expense) where transactions from the journal are posted and categorized. The ledger provides the final balances for all accounts used to prepare financial statements.

Accounts Payable (AP) represents the money a company owes to its suppliers for goods or services purchased on credit. It’s a liability on the balance sheet. Accounts Receivable (AR) is the money a company is owed by its customers for goods or services sold on credit. It’s an asset on the balance sheet.