Total Liabilities

Total liabilities are all the debts and obligations of a company or individual. They include current liabilities, such as accounts payable and accrued expenses, as well as long-term liabilities, such as bonds payable and mortgages.

Current liabilities are debts that are due within one year. They include accounts payable, which are amounts owed to suppliers for goods and services purchased on credit; accrued expenses, which are expenses that have been incurred but not yet paid, such as salaries and wages; and taxes payable, which are taxes that have been incurred but not yet paid.

Long-term liabilities are debts that are due more than one year from now. They include bonds payable, which are loans that are repaid with interest over a period of time; mortgages, which are loans used to purchase real estate; and other long-term debt, such as loans from banks and other lenders.

Total liabilities are an important part of a company's financial statements. They are used to calculate a company's debt-to-equity ratio, which is a measure of a company's financial leverage. A high debt-to-equity ratio indicates that a company is using a lot of debt to finance its operations, which can be risky if the company is unable to repay its debts.

Total liabilities can also be used to calculate a company's working capital, which is the amount of money a company has available to fund its day-to-day operations. A positive working capital indicates that a company has enough money to pay its bills and meet its other obligations.

Total liabilities are an important part of a company's financial health. They can be used to assess a company's financial risk and its ability to meet its financial obligations.