0
That depends on the term of the loan. Let's define Current Liability and Long-Term Liability
A current liability is any liability that will be paid off within one year (or less) or one accounting cycle. A bank loan, if is financed for One Year or less, would be classified as a Current Liability.
A Long-Term Liability is anything OVER a year. So if the bank loan is financed for more than one year, it will then be classified as a Long-Term Liability.
Wiki User
∙ 14y ago
Add your answer:
Earn +20 pts
Is Demand loan a current liability or a long term liability?
a current liability
Is a loan is current liability or long term liability in the balance sheet?
If loan is payable within twelve month of issuance of loan then it is current liability but if it is payable in more than one fiscal year then it is long term liability but even in long term loan, that portion of loan which is payable in current fiscal year is current liability and remaining portion is long term liability.
Is temporary overdraft a current liability?
Yes. An overdraft simply means that the bank has paid an item that was presented against your bank account and represents, essentially, a short term loan from the bank to you. Like any other short term obligation, it is a current liability.
Is a bank loan a financial asset?
Bank loan is a liability for business not an asset for business.
What is external liability?
what is external liability all debts that are external from the business eg. bank loan,bank overdraft,
Is Demand loan a current liability or a long term liability?
a current liability
Is a loan is current liability or long term liability in the balance sheet?
If loan is payable within twelve month of issuance of loan then it is current liability but if it is payable in more than one fiscal year then it is long term liability but even in long term loan, that portion of loan which is payable in current fiscal year is current liability and remaining portion is long term liability.
Is temporary overdraft a current liability?
Yes. An overdraft simply means that the bank has paid an item that was presented against your bank account and represents, essentially, a short term loan from the bank to you. Like any other short term obligation, it is a current liability.
Is a bank loan a financial asset?
Bank loan is a liability for business not an asset for business.
Is a long term loan repayable in 6 years a non current asset or non current liability?
It is a loan repayable. Hence it is a liability. As the liability is for more than one year, it is non current liability.
Is loaned cash an asset?
Yes, it is a current asset as part of the cash at bank. It also creates a liability for the amount of the loan.
What is the entry for bank loan account?
Debit Bank Account - Assets Credit Bank Loan Account - Liability
What is the rule for classifying a liability as current?
A current liability is one that is due within a year. Anything after a year is a mon current liability. If however part is due within a year and the rest in later years such as a bank loan then you should show the amount that is due in a year as current and the rest as non current.
Is a bank loan an asset or liability?
It Depends:If you are the bank, then the loan is an asset because, the loan customer is going to repay you the loan amount with interest and you are going to earn an income from it.If you are the loan customer, then the loan is a liability because you are going to return the money along with interest to the bank that gave you the loan.
Is Cash Credit Loan a current Liability?
no
Is a bank an asset or liability?
It Depends:If you are the bank, then the loan is an asset because, the loan customer is going to repay you the loan amount with interest and you are going to earn an income from it.If you are the loan customer, then the loan is a liability because you are going to return the money along with interest to the bank that gave you the loan.
Why is a loan a liability for a bank?
The person or business may not pay the loan back and the bank has to take the loss
