Definition Of Liabilities - 1623 Words

Current Liabilities Outstanding expenses Outstanding expenses are the opposite of prepaid expenses.. Even though they are to be paid at some future date, like wages, rent, etc.they are indicated on the firms balance sheet and firm have liability to pay this outstanding expenses in future when firm have cash in hand. Creditor Definition: †¦Ã¢â‚¬ ¦Ã¢â‚¬Å"Creditor is an accounting expression to indicate a party that has delivered a product, service or loan, and is owed money by one or more debtors†. In simple way we can say creditors are that those which are we purchase product, service or take money in credit base and we can make a promise to creditors to we can pay those money in future. Overdraft When a person or business require money this time†¦show more content†¦In business to getting profits, we need to buy some current assets and fixed assets. .Source and components of working capital Sources of finance for working capital are two ways like long term loan and short terms loan. In working capital or short term source are include bank loans, retained earnings, credit from suppliers, long-term loans from financial institutions, or proceeds from sale of assets. Sources of working capital finance Long-Term Loans Long term loan is the amount of money that is given to an individual or a company on the agreement .In this agreement they agree for pay the borrowed amount in a period that exceeds 12 months. In long term loan interest rate are .pre decided by the both parties and usually secured against certain assets .This type loan are given by different financial institutions .This type of loan taken by business men secure for long-term working capital for the business. Short-Term Loans Short-term loans are to be repaid within a year. Many financial institutions give this type loan like †¦.Savings banks, cooperatives and the government, private financers are some of the institutions that offer these loans. Bank overdraft is one such source of business finance. Trade Credit Trade credit is the credit given by one business trader to another for the purchase of goods and services. Or in otherShow MoreRelatedThe International Accounting Standards Board Essay1703 Words   |  7 Pages† According to Leisenring(2013)â€Å"That assets and liabilities are the fundamental elements of financial statements still is undoubtedly the most controversial, and the most misunderstood and misrepresented, concept in the entire conceptual framework† This essay focus mainly on revised definition of asset and liability , incorporating the discussion of the weakness of current definition about asset and liability, the analysis of proposed definition and demonstration of how the new proposal strengthenRead MoreThe Tort Of Intentional Interference With Economic Relations1127 Words   |  5 Pagescomponents of the unlawful means tort are that the defendant must use unlawful means to interfere with a trade or business, and that the defendant must intend to harm the plaintiff through the use of unlawful means. The tort creates â€Å"parasitic† liability in a three-party situation, meaning the plaintiff can sue for their economic loss due to the unlawful acts. 2. Why was Bram Enterprises Ltd. and Jamb Enterprises Ltd.’s (hereinafter ‘the Plaintiffs’) claim for intentional interference with economicRead MoreAcc/300 Week One Accounting Equation1262 Words   |  6 PagesThe accounting equation is, Assets are equal to Liabilities plus Stockholders’ Equity. Assets are resources owned by a business. Liabilities are the debts and obligations of the business. Liabilities represent claims of creditors on the assets of a business. Stockholders’ equity represents the claims of owners on the assets of the business. This equity is divided into two parts: common stock and retained earnings. The balance sheet reports assets and claims to assets at one specific point in timeRead MoreThe Mercantile Theory Of Criminal Law1642 Words   |  7 Pagesfreedom of choice and liberties of the individual, should be maximized by criminal law and always be taken into consideration when deliberating upon sentencing and judgements in cases. The Mercantile Theory deliberately opposes the idea of strict liability as it wishes for excuses to be welcomed in the law system to prevent excessive or wrongful punishment. By allowing excuses with The Mercantile Theory, we are allowed freedom in Hart’s view. Hart argues that if a person can enter a considerably dangerousRead MoreConceptual Framework For Financial Reporting1512 Words   |  7 PagesIFRS:Conceptual Frameworkfor Financial Reporting Role of the Conceptual Framework Conceptual Framework sets out agreed concepts that underlie financial reporting objective, qualitative characteristics, element definitions IASB uses Conceptual Framework to set standards enhances consistency across standards enhances consistency over time as Board members change provides benchmark for judgments Preparers use Conceptual Framework to develop accounting policies in the absence of specific standard orRead MoreDefend the Asset/Liability Approach of Accounting for Inter-Period Income Tax Allocation.642 Words   |  3 PagesTeam 2: Defend the asset/liability approach of accounting for inter-period income tax allocation. The asset/liability method of income tax allocation is balance sheet oriented. The intent is to accrue and report the total tax benefit or taxes payable that will actually be realized or assessed on temporary differences when their respective future taxable or deductible amounts are expected to occur. The book states 5 arguments: 1. The balance sheet is becoming more important financial statementRead MoreThe Conceptual Framework For Financial Reporting1286 Words   |  6 Pages(International Accounting Standard Board) releases the latest Exposure Draft (ED) ED/2015/3 proposal revising the conceptual framework for Financial Reporting that will set the future directions for the content of IFRS. The ED proposes revision to the definitions of elements in the financial statements, including guidance on derecognition, discussion on measurement basis, OCI in relation to performance reporting. The proposals aim is to improve financial reporting by providing a more complete, clearer andRead MoreBusiness Formations : The Legal Environment1143 Words   |  5 Pages 1 LAWS-310: The Legal Environment Memo to Gloria Smithson +++ Linda Plowman DeVry University Sep 21, 2014 Table of Contents Introduction 3 Business Formations Identification 3 Business Formations Definition 4 Pros and cons 5 Conclusion 7 References 8 â€Æ' Introduction This memo is about providing to Smithson’s family a summarized and explanatory paper that will advise them regarding their will to create a business, which will be able to grow steadilyRead MoreWorking Capital Concept And Definitions Essay1063 Words   |  5 Pages2-2 Working capital concept and definitions According to, the first formation of the concept of working capital was possibly first established by Karl Marx (Bhattacharya 2006). Working capital was defined as current assets minus current liabilities. In general, this definition is also identified as â€Å"networking capital†. are sometimes Current assets called as gross working capital. The current assets can be divided into four main elements: (1) cash (2) marketable securities (3) accounts receivableRead MoreCase 9-4 Needsspace Essay1609 Words   |  7 Pagesthere is a contractual liability for the lessee to perform general repair and maintenance, the maintenance requirement provision may be assumed as a present economic obligation, not just a future commitment. If the fair value estimate of future maintenance expense can be measured with sufficient reliability, the provision may lead to recognition of an accrued liability for the repair and maintenance performance obligation at the inception of the lease. The accrued liability for the repair and maintenance