Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

9. Current Liabilities

Types of Liabilities

Financial Accounting

9. Current Liabilities

Types of Liabilities

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Multiple Choice

What is the debt a firm owes to an outside party referred to as?

Asset

Liability

Equity

Revenue

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Verified step by step guidance

Understand the concept of liabilities: In financial accounting, liabilities represent the debts or obligations a firm owes to outside parties, such as loans, accounts payable, or accrued expenses.

Differentiate liabilities from other financial terms: Assets are resources owned by the firm, equity represents the owner's claim on the firm's assets, and revenue is the income generated from business operations.

Review the definition of liability: A liability is a present obligation of the firm arising from past events, which is expected to result in an outflow of resources embodying economic benefits.

Analyze the options provided: Among the choices (Asset, Liability, Equity, Revenue), identify which term matches the definition of debts owed to outside parties.

Select the correct answer: Based on the explanation, the term 'Liability' is the correct choice as it refers to the firm's debts owed to external parties.