Liability

LIABILITY can be further divided into 2 parts:

  1) NON-CURRENT LIABILITY : Liability that must be paid off to debtors in more than one year .
  2) CURRENT LIABILITY : Liability that must be paid off to debtors within one year.



Components of Non-Current Liability:
  1) LONG TERM NOTE PAYABLES : Money owed by company to creditors with formal agreement. Examples are long term borrowing, bond issued by company.
  2) DEFErRED TAX LIABILITY : Tax that had been paid less in the past.

 
Components of Current Liability:
  1) TRADE PAYABLES :  Money owed by company to suppliers
  2)  NOTE PAYABLES : Money owed by company to creditors with formal agreement. Examples are short term borrowing.
  3) ACCRUED EXPENSES : Expenses that had been used but haven't  pay.
  4) UNEARNED REVENUE : Payments received but company has not provided good or services yet.
  5) DEFERRED TAX LIABILITY : Tax that had been paid less in the past.

*Further Information for
“Equity”