Answer:
The obligation to provide goods that customers have ordered and paid for during the current year.
Explanation:
In Financial accounting, liability can be defined as the amount of money being owed by an individual or organization to another.
Simply stated, liability is a debt being owed and as such it usually has "payable" in its account title on the balance sheet.
Generally, liabilities are recorded on the right side of the balance sheet and it comprises of financial informations such as warranties, bonds, loans, deferred revenues, mortgages, account payable etc.
Current liability 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.
An example of a liability is the obligation of a business firm (wholesaler or retailer) to provide goods or services that customers have ordered and paid for during the current year.
