The purpose of this tool it's revealed inside the title. APK Editor is a free Android application that lets users edit APK files on their devices. The main screen comes with a basic design, and you can pick to provide the APK file or to extract one from an already installed app. If it's your first time using this tool, you might have to take a look inside the help section to get some reference.
This editor comes with two types of editing: simple and full edit. The first one is easier, and you get to replace files inside the APK, while the Full Edit allows the user to rebuild files from an APK. You might ask yourself what you can edit using this application. You can change permissions, background images, settings, languages, and more. Once you're done changing the aspects that you want, just press the Save button located at the top of the window to save your work, and after that, you're free to try the edited app.
Overall, this tool is useful in the hands of those who are experienced in this type of work, and just like it was mentioned way above, the Help documentation might provide some insight.