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

Which of the following is an example of a long-term liability?

Salaries payable

Bonds payable

Accounts payable

Unearned revenue

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Verified step by step guidance

Understand the concept of liabilities: Liabilities are obligations that a company owes to external parties, typically arising from past transactions or events. They are classified into two categories: current liabilities and long-term liabilities.

Define long-term liabilities: Long-term liabilities are obligations that are not due within the company's operating cycle or one year, whichever is longer. Examples include bonds payable, long-term loans, and lease obligations.

Analyze each option: Salaries payable, accounts payable, and unearned revenue are all current liabilities because they are typically settled within one year or the operating cycle. Bonds payable, however, is a long-term liability because it represents debt that is due over a period longer than one year.

Relate the concept to the problem: Since the question asks for an example of a long-term liability, identify the option that fits the definition of a long-term liability.

Conclude the reasoning: Bonds payable is the correct answer because it is a financial obligation that extends beyond one year, making it a long-term liability.