The debt owed by a business is called liabilities. Liabilities are obligation that a person or business has, typically financial in nature. Over time, liabilities are resolved by the transmission of economic advantages like products, services.
Liabilities on balance sheet's right side are represented by debts like as loans, accounts payable, mortgages, deferred revenue, bonds, warranties etc. Assets can be contrasted with liabilities. Assets are items business own or owe money to, whereas liabilities are debts or other obligations.
Short-term financial commitments of a business that are due in a year or within its typical operational cycle are known as current liabilities.
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