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Ludmilka [50]
2 years ago
12

4. Which of the following is a characteristic of a current liability? (1 point)

Mathematics
1 answer:
lozanna [386]2 years ago
4 0

Answer:

B. A current liability is due within one year or one operating cycle, whichever is longer.

Step-by-step explanation:

Current liability in financial accounting can be defined as the short-term financial obligation such as debt (account payable) that is due to be paid in cash within one (fiscal) year or one operating cycle of a company, whichever is longer.

A company's current liability comprises of the following; dividends payable, short-term debts, account payable, notes payable, interest payable, wages payable, deferred revenues, income tax payable, etc.

Basically, companies usually settles their current liabilities with current assets such as account receivables or cash, that are used up within a fiscal year.  

<em>Hence, a characteristic of a current liability is that, a current liability is due within one year or one operating cycle, whichever is longer.  </em>

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