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Liabilities can be described as ‘everything the company owes to others’. Liabilities are basically used to pay for assets. Liabilities are divided into 2 accounts : current liabilities and non-current liabilities. Current liabilities must be paid within 1 year, non-current liabilities any time later than that. Liabilities belonging to

Current liabilities are :

  • Current portion of long-term debt
  • Bank debt
  • Interest payable
  • Rent, tax, utilities
  • Wages payable
  • Customer prepayments
  • Dividends payable and others

Non-current liabilities are :

  • Long-term debt
  • Pension fund liability
  • Deferred tax liability

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