The financial obligations or debts that a company or individual owes to other parties, such as loans, accounts payable, or accrued expenses.
Liabilities are financial obligations or debts that a business owes to external parties. They represent the claims or obligations that arise during the course of business operations and must be settled in the future. Common examples of liabilities include loans, accounts payable, accrued expenses, and taxes payable. As a small business owner, understanding your liabilities is crucial for managing your financial obligations and ensuring the long-term financial health of your business.