Current Liabilities & Contingencies

Current Liabilities & Contingencies

Current Liabilities: Current Liabilities are obligations whose liquidation is reasonably expected to require use of existing resources properly classified as current assets. or the creation of other current assets or the creation of other current liabilities.

Some typical current liabilities are -

1. Accounts Payable

2. Notes Payable

3. Dividends payable

4. Income taxes payable

5. Unearned revenues

6. Sales taxes payable

7. Customers advances & deposits

8.Current maturities of long term debt 

9. Short-term obligations expected to be refinanced

10. Employee related liabilities.

1. Accounts Payable

Accounts payable (AP), or Trades Accounts payable(TAP), are balances owed to others for goods, supplies, or services purchased on open account. accounts payable arise from the slack between the receipt of services or acquisition of title to assets and the payment for them.

2. Notes Payable

 A note payable is a written promissory note. Under this agreement, a borrower obtains a specific amount of money from a lender and promises to pay it back with interest over a predetermined time period.

they may arise from purchases, financing, or other transactions.