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January 19, 2023
A liability is anything that a person or corporation owes, generally monetary. Liabilities are resolved over time by transferring economic advantages such as money, products, or services. Liabilities recorded on the balance sheet's right side include loans, accounts payable, mortgages, deferred revenues, bonds, warranties, and accumulated costs. In general, a liability is an unfulfilled or unpaid commitment between one party and another. A financial liability is also an obligation in the world of accounting. Still, it is better defined by prior business transactions, events, sales, exchange of goods or services, or anything that might offer economic gain later. Current obligations are often short-term (anticipated to be completed in 12 months or less), whereas non-current liabilities are long-term (12 months or greater).