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Liabilities are money or moneys owed to another individual or company by another. There are two main liability categories, Current Liabilities and Long-Term Liabilities.
Current Liabilities are liabilities that will be paid for in a short amount of time, 12 months or less.
Long-Term Liabilities are liabilities that will take longer than 12 months to pay off.
Two good examples of these are Equipment that a company purchases on account and will pay off in less than six months and large equipment or assets such as land, equipment, buildings, etc, that will take much longer than six months to pay off. Two further examples may be
A POS (point of sale) computer that cost $3,000. The company may choose to pay this equipment off in 6 months from purchase date, this is considered a Current Liability since the payment of this debt will be paid in less than 12 months.
I purchase a building/land to open my business for say $500,000, this is a huge amount and it is unlikely (unless I'm really RICH) that I would pay this off in 6 months or less, therefore I will take a mortgage out on the building/land. The building/land is an asset for my company yes, however the mortgage payment, which will probably be 10 years or so, is a liability and is considered Long-Term.
What else can I help you with?
Type of liabilities?
There are several different types of liabilities. The two main types are current and long term. Then there are contingent liabilities which can be classified as either current or long time.
What do current liabilities mean in accounting?
Current Liabilities in accounting are amounts that are owed by a business. The two types of current liabilities are short-term and long-term liabilities.
What are the examples of balance sheet equation?
Assets =liabilities + owners equity
What are different kinds of liability?
There are several types of liabilities but for financial accounting liabilities are generally split into current and long term liabilities. Current liabilities are accounts payable and loans that payment is made on demand. Long term liabilities are debts that payable more than a year out.
Examples of current liabilities?
accounts payable short term loan payable
Type of liabilities?
There are several different types of liabilities. The two main types are current and long term. Then there are contingent liabilities which can be classified as either current or long time.
What do current liabilities mean in accounting?
Current Liabilities in accounting are amounts that are owed by a business. The two types of current liabilities are short-term and long-term liabilities.
What are some examples of liabilities that a company may have?
Some examples of liabilities that a company may have include loans, accounts payable, accrued expenses, and bonds payable. Liabilities are obligations that a company owes to external parties and are recorded on the company's balance sheet.
What are the examples of financial liabilities?
A financial liability is defined as the obligation to give cash to another entity under certain conditions. Some examples of financial liabilities are accounts payable and loans.
Define contingent liabilities?
types of liabilities also used in accounting matter in business level accounting. when use this liabilities at money goes outside also get some types of loss but not actual loss of the company's accounting departmental also.
What are the examples of balance sheet equation?
Assets =liabilities + owners equity
What are different kinds of liability?
There are several types of liabilities but for financial accounting liabilities are generally split into current and long term liabilities. Current liabilities are accounts payable and loans that payment is made on demand. Long term liabilities are debts that payable more than a year out.
Examples of current liabilities?
accounts payable short term loan payable
What are examples of current liabilities?
Short term loans, Insurance prepaid a/c
What are examples of business liabilities and how can they impact a company's financial health?
Examples of business liabilities include loans, accounts payable, and accrued expenses. These liabilities represent money owed by the company to others. If a company has high levels of liabilities, it may struggle to meet its financial obligations, leading to cash flow problems, increased interest expenses, and potential bankruptcy. Managing liabilities effectively is crucial for maintaining a healthy financial position.
Which of the following types of accounts are decreases recorded by credits?
revenues, liabilities
What are the examples of current assets and current liabilities?
Some current assets include:CashMarket able securitiesA/C ReceivableSome current liabilities include:A/C payableNotes Payable
