Question

Liabilities are what??

Answer 1

Hey Friend.

Liabilities are debts of the business.

There are two types of liabilities :

1) Current Liability - represent debts that will be repaid within a year. e. g. Creditor (accounts payable), bank overdraft, expenses owing, prepaid revenue, etc.

2) Long term Liability - are debts that will be repaid in more than a year. e. g. Mortgage, bank loan, etc.