{"id":3796,"date":"2020-10-22T20:16:29","date_gmt":"2020-10-22T20:16:29","guid":{"rendered":"https:\/\/courses.lumenlearning.com\/wm-financialaccounting\/?post_type=chapter&p=3796"},"modified":"2020-12-03T20:28:09","modified_gmt":"2020-12-03T20:28:09","slug":"introduction-to-current-liabilities","status":"publish","type":"chapter","link":"https:\/\/courses.lumenlearning.com\/suny-clinton-financialaccounting\/chapter\/introduction-to-current-liabilities\/","title":{"raw":"Introduction to Current Liabilities","rendered":"Introduction to Current Liabilities"},"content":{"raw":"

What you will learn to do: Define current liabilities<\/h2>\r\nLiabilities are obligations to pay cash, provide services, or deliver goods at some future time.\r\n\r\nFASB\u2019s Concept Statement No. 6, in place for more than 20 years, defines liabilities as \u201cprobable future sacrifices of economic benefits arising from present obligations of a particular entity to transfer assets or provide services to other entities in the future as a result of past transactions or events.\u201d\r\n\r\nMost balance sheets divide liabilities into current liabilities and long-term liabilities.\r\n\r\nLet\u2019s zoom in on The Home Depot balance sheet<\/a> for the fiscal year ended February 2, 2020:\r\n\r\n[caption id=\"attachment_6384\" align=\"aligncenter\" width=\"850\"]\"See See the balance sheet long description<\/a> here.[\/caption]\r\n\r\nCurrent liabilities are obligations that (1) are payable within one year or one operating cycle, whichever is longer, or (2) will be paid out of current assets or create other current liabilities.\r\n\r\nLong-term liabilities are obligations that do not qualify as current liabilities.","rendered":"

What you will learn to do: Define current liabilities<\/h2>\n

Liabilities are obligations to pay cash, provide services, or deliver goods at some future time.<\/p>\n

FASB\u2019s Concept Statement No. 6, in place for more than 20 years, defines liabilities as \u201cprobable future sacrifices of economic benefits arising from present obligations of a particular entity to transfer assets or provide services to other entities in the future as a result of past transactions or events.\u201d<\/p>\n

Most balance sheets divide liabilities into current liabilities and long-term liabilities.<\/p>\n

Let\u2019s zoom in on The Home Depot balance sheet<\/a> for the fiscal year ended February 2, 2020:<\/p>\n

\"See<\/p>\n

See the balance sheet long description<\/a> here.<\/p>\n<\/div>\n

Current liabilities are obligations that (1) are payable within one year or one operating cycle, whichever is longer, or (2) will be paid out of current assets or create other current liabilities.<\/p>\n

Long-term liabilities are obligations that do not qualify as current liabilities.<\/p>\n\n\t\t\t

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Candela Citations<\/h3>\n\t\t\t\t\t
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