APE

Ape, as you might have guessed, is the extension used by Monkey’s Audio.
It is a open source lossless audio compressor.
According to the website:

• Efficient (fast and great compression) – Monkey's Audio is highly optimized and highly efficient
• Perfect sound – absolutely no quality loss, meaning it sounds perfect and decompresses perfect (it's lossless!)
• Media Center™, Winamp™, and more support – supported by many popular players and rippers
• Easy – the Windows environment interface is both powerful and easy to use
• Free – Monkey’s Audio is completely free!
• Error detection – Monkey’s Audio incorporates redundant CRC’s to ensure proper decompression of data (errors never go unnoticed)
• Tagging support – Monkey’s Audio uses its own extremely flexible APE Tags so you can easily manage and catalogue your Monkey’s Audio collection.

The website also features a theory section, explaining the basics of lossless compression.

Monkey's Audio - website