Liability is defined as the following: A liability is a present obligation of the entity that arises from past events. The settlement of the liability is expected to result in an outflow from the entity in the form of resources such as assets, providing a service or payment of an account. Explanation A liability is… Read More

Accounts receivable is a legally enforceable claim for payment from a business to its customers for goods they have purchased or services requested. These are normally in the form of invoices raised by a business and delivered to the customer for payment within an approximate time frame. Accounts receivable is shown in a balance sheet… Read More

Accounts payable means a liability to a creditor that’s carried on an open account. It is usually for the purchases of good and services. When a company orders and receives good or services in advance of a payment, we usually say the company is purchasing on account or credit. The supplier of the goods is… Read More