ECONOMICS

Detailed explanation-1: -A liability is something a person or company owes, usually a sum of money. Liabilities are settled over time through the transfer of economic benefits including money, goods, or services.

Detailed explanation-2: -Liabilities are the legal debts a company owes to third-party creditors. They can include accounts payable, notes payable and bank debt. All businesses must take on liabilities in order to operate and grow. A proper balance of liabilities and equity provides a stable foundation for a company.

Detailed explanation-3: -In short, yes-cash is a current asset and is the first line-item on a company’s balance sheet. Cash is the most liquid type of asset and can be used to easily purchase other assets.

Detailed explanation-4: -Outstanding expenses are treated as liabilities in the balance sheet of a company.