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Types of Liabilities

Accounts Payable
Accounts Payable

For example, a company's balance sheet reports assets of $100,000 and Accounts Payable of $40,000 and owner's equity of $60,000. The source of the company's assets are creditors/suppliers for $40,000 and the owners for $60,000.

Accounts Payable
Accounts Payable

Liabilities are obligations of the company; they are amounts owed to creditors for a past transaction and they usually have the word "payable" in their account title. Along with owner's equity, liabilities can be thought of as a source of the company's assets.

Accounts Receivable
Accounts Receivable

If an item sells, the price is debited from inventory and credited to accounts receivable. Once payment is received, the amount is debited from AR and credited to cash or revenue. The order and manner of debits and credits depends upon the type of accounting used by a company.

Accounts Receivable
Accounts Receivable

Accounts receivable is a type of ledger entry in a company’s financial reporting that indicates moneys to be received. Specifically, accounts receivable, or AR, is created when one entity provides a service or product but has not received payment yet.

Accrued Expenses
Accrued Expenses

An accrued expense is an accounting expense recognized in the books before it is paid for. It is a liability, and is usually current. These expenses are typically periodic and documented on a company's balance sheet due to the high probability that they will be collected.

Bank Account Overdrafts
Bank Account Overdrafts

When a business' bank account has a negative balance it is said to be running a bank overdraft (more precisely an actual bank overdraft). It is a form of financing in which the bank honors presented checks even when there is no balance in the business account which results in negative balance in the bank account.

Bills Payable
Bills Payable

BREAKING DOWN 'Bills Payable' In the context of personal finance and small business accounting, bills payable are liabilities such as utility bills. They are recorded as accounts payable and listed as current liabilities on a balance sheet.

Cash and Cash Equivalents
Cash and Cash Equivalents

Cash and cash equivalents (CCE) are the most liquid current assets found on a business's balance sheet. Cash equivalents are short-term commitments "with temporarily idle cash and easily convertible into a known cash amount".

Cash and Cash Equivalents
Cash and Cash Equivalents

Cash and cash equivalents (CCE) are the most liquid current assets found on a business's balance sheet. Cash equivalents are short-term commitments "with temporarily idle cash and easily convertible into a known cash amount".

Customer Deposits
Customer Deposits

A customer deposit could be an amount paid by a customer to a company prior to the company providing it with goods or services. In other words, the company receives the money prior to earning it. The company receiving the money has an obligation to provide the goods or services to the customer or to return the money.

Income Taxes Payable
Income Taxes Payable

Income tax payable is a type of account in the current liabilities section of a company's balance sheet. It is comprised of taxes due to the government within one year. The calculation of income tax payable is according to the prevailing tax law in the company's home country.

Income Taxes Payable
Income Taxes Payable

Other Accrued Expenses Payable; Income Taxes Payable; Customer ... Classifications Of Liabilities On The Balance Sheet. Liability and contra liability accounts ...

Interest Payable
Interest Payable

interest payable definition This current liability account reports the amount of interest the company owes as of the date of the balance sheet. (Future interest is not recorded as a liability.) (Future interest is not recorded as a liability.)

Interest Payable
Interest Payable

On December 31 the amount of interest payable is $1,000 ($100,000 X 12% X 1/12) and the company's balance sheet should report the following current liabilities: Notes payable of $100,000; Interest payable of $1,000; The future interest of $8,000 (for January through August) is not reported as a liability as of December 31.

Inventory
Inventory

Inventory as a Liability Technically, inventory isn't a liability in the accounting sense that it represents something you owe, but it can fit another definition of the word: a disadvantage or drawback.

Inventory
Inventory

Keeping an eye on your assets and liabilities is a critical part of running your small business. Inventory, the physical goods you sell or use to make your product, is an asset. You report inventory on your balance sheet when preparing financial statements that review your company's financial health.

Marketable Securities
Marketable Securities

For a company that is low on cash and has all its balance tied in marketable securities, an investor may exclude the cash commitments that management announced from its marketable securities, since this portion of marketable securities is earmarked and spent on something other than paying off current liabilities.

Marketable Securities
Marketable Securities

Marketable securities are liquid financial instruments that can be quickly converted into cash at a reasonable price.

Notes Payable
Notes Payable

In accounting, Notes Payable is a general ledger account in which a company records the face amounts of the promissory notes that it has issued. The amounts for the promissory notes (or simply notes) that have not been repaid are reported as part of the company's liabilities.

Notes Payable
Notes Payable

In accounting, Notes Payable is a general ledger account in which a company records the face amounts of the promissory notes that it has issued. The amounts for the promissory notes (or simply notes) that have not been repaid are reported as part of the company's liabilities.

Other Accrued Expenses Payable
Other Accrued Expenses Payable

Accounts payable is the total amount of debt the company has to pay to its creditors for goods or services bought on credit. On the other hand, accrued expenses is the total liability that is payable for goods and services that have been received but not been billed.

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Payroll Taxes Payable
Payroll Taxes Payable

Post your employer tax contributions as a debit to the payroll tax expense account. Credit the payroll tax payable account for the balance due. Taxes that are withheld from an employee paycheck are entered as a debit to your salary expense account and a credit to your payable account.

Prepaid Expenses
Prepaid Expenses

A prepaid expense is an asset that arises on a balance sheet as a result of business making payments for goods and services to be received in the future. A prepaid expense is an asset that arises on a balance sheet as a result of business making payments for goods and services to be received in the future.

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Salaries Payable
Salaries Payable

salaries payable definition. The current liability account which reports the amount of salaries earned by a company's employees, but which have not yet been paid by the company.

Salaries Payable
Salaries Payable

salaries payable definition. The current liability account which reports the amount of salaries earned by a company's employees, but which have not yet been paid by the company.

Sales Taxes Payable
Sales Taxes Payable

Sales Tax Payable Account (Liability) or Sales Tax Payable Expense Account? We have recently changed from writing checks to pay monthly sales taxes by way using the Pay Sales Tax window to paying the taxes online directly to the tax agency.

Short-Term Loans
Short-Term Loans

Short-term debt is an account shown in the current liabilities portion of a company's balance sheet. This account is made up of any debt incurred by a company that is due within one year. The debt in this liabilities account is usually made up of short-term bank loans taken out by a company, among other types.

Wages Payable
Wages Payable

wages payable definition. A current liability account that reports the amounts owed to employees for hours worked but not yet paid as of the date of the balance sheet.

Wages Payable
Wages Payable

wages payable definition. A current liability account that reports the amounts owed to employees for hours worked but not yet paid as of the date of the balance sheet.

Related Types