What Are The Types of Liabilities In Accounting
Liabilities are the obligations or debts due payable by the business to outsiders i.e., Creditors or Accounts Payable or Suppliers, Banks, Financial Institutions, etc. Examples of Liabilities are Accounts Payable , Accrued Liabilities or Outstanding Expenses , Income / Revenue Received in Advance , Bank Loans, etc. There are three types of Liabilities: 1. Current Liabilities Current Liabilities are used by the business within one year or less. Examples are Accounts Payable / Creditors, Outstanding Expenses, Advance Income / Revenue Received or Prepaid Income, etc. 2. Long-Term Liabilities / No n Current Liabilities Long-Term Liabilities are used by the business for more than one year Examples are Bank Loans, Deferred Liabilities. 3. Contingent Liabilities These are depended upon the happening of uncertain future event that may or may not occur. An entity shall recognize that contingent liability in N otes to the Account...