Current liability: Current liability refers to the debts of an organization. It is an obligation of the company that is due to be paid within one year. Long-term debt: Long-term debt refers to the obligations of a firm that are due and has a due period exceeding a year. To determine the difference between current liability and long-term debt.

Question

Want to see more full solutions like this?

Answer 1

Question

Chapter 13, Problem 1Q

To determine

Current liability: Current liability refers to the debts of an organization. It is an obligation of the company that is due to be paid within one year.

Long-term debt: Long-term debt refers to the obligations of a firm that are due and has a due period exceeding a year.

To determine the difference between current liability and long-term debt.

Expert Solution & Answer

Explanation of Solution

Both current liabilities and long-term debts act as a focal point of the financial planning efforts of an organization.

Current liabilities are obligations to be paid within a year. If the debts are paid within the stipulated period, the short-term liability of the company is found to be positive. This means that the company meets the cash flow needs and it is considered as a going concern.

Long-term debts are obligations for which the due period exceeds 1 year. If the debts are paid within the stipulated period, the long-term liquidity of the company will be positive. The probability of meeting the financial needs of the company turns to be favourable.

Conclusion

Hence, the difference between current liability and long-term debt are explained above.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Students have asked these similar questions

Brighton Electronics sold 4,200 units in December at a sales price of $50 per unit. The variable cost is $30 per unit. Calculate the total contribution margin, the contribution margin percentage, and the contribution margin per unit. No AI ANSWER

What are some driving forces behind businesses deciding to change entities when new legislation for tax is introduced?

Compute chill spa's net income for 2021

Answer 2

Question

Chapter 13, Problem 1Q

To determine

Current liability: Current liability refers to the debts of an organization. It is an obligation of the company that is due to be paid within one year.

Long-term debt: Long-term debt refers to the obligations of a firm that are due and has a due period exceeding a year.

To determine the difference between current liability and long-term debt.

Expert Solution & Answer

Explanation of Solution

Both current liabilities and long-term debts act as a focal point of the financial planning efforts of an organization.

Current liabilities are obligations to be paid within a year. If the debts are paid within the stipulated period, the short-term liability of the company is found to be positive. This means that the company meets the cash flow needs and it is considered as a going concern.

Long-term debts are obligations for which the due period exceeds 1 year. If the debts are paid within the stipulated period, the long-term liquidity of the company will be positive. The probability of meeting the financial needs of the company turns to be favourable.

Conclusion

Hence, the difference between current liability and long-term debt are explained above.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Chapter 13, Problem 1Q

To determine

Current liability: Current liability refers to the debts of an organization. It is an obligation of the company that is due to be paid within one year.

Long-term debt: Long-term debt refers to the obligations of a firm that are due and has a due period exceeding a year.

To determine the difference between current liability and long-term debt.

Expert Solution & Answer

Explanation of Solution

Both current liabilities and long-term debts act as a focal point of the financial planning efforts of an organization.

Current liabilities are obligations to be paid within a year. If the debts are paid within the stipulated period, the short-term liability of the company is found to be positive. This means that the company meets the cash flow needs and it is considered as a going concern.

Long-term debts are obligations for which the due period exceeds 1 year. If the debts are paid within the stipulated period, the long-term liquidity of the company will be positive. The probability of meeting the financial needs of the company turns to be favourable.

Conclusion

Hence, the difference between current liability and long-term debt are explained above.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 13, Problem 1Q

To determine

Current liability: Current liability refers to the debts of an organization. It is an obligation of the company that is due to be paid within one year.

Long-term debt: Long-term debt refers to the obligations of a firm that are due and has a due period exceeding a year.

To determine the difference between current liability and long-term debt.

Expert Solution & Answer

Explanation of Solution

Both current liabilities and long-term debts act as a focal point of the financial planning efforts of an organization.

Current liabilities are obligations to be paid within a year. If the debts are paid within the stipulated period, the short-term liability of the company is found to be positive. This means that the company meets the cash flow needs and it is considered as a going concern.

Long-term debts are obligations for which the due period exceeds 1 year. If the debts are paid within the stipulated period, the long-term liquidity of the company will be positive. The probability of meeting the financial needs of the company turns to be favourable.

Conclusion

Hence, the difference between current liability and long-term debt are explained above.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 13, Problem 1Q

To determine

Current liability: Current liability refers to the debts of an organization. It is an obligation of the company that is due to be paid within one year.

Long-term debt: Long-term debt refers to the obligations of a firm that are due and has a due period exceeding a year.

To determine the difference between current liability and long-term debt.

Expert Solution & Answer

Explanation of Solution

Both current liabilities and long-term debts act as a focal point of the financial planning efforts of an organization.

Current liabilities are obligations to be paid within a year. If the debts are paid within the stipulated period, the short-term liability of the company is found to be positive. This means that the company meets the cash flow needs and it is considered as a going concern.

Long-term debts are obligations for which the due period exceeds 1 year. If the debts are paid within the stipulated period, the long-term liquidity of the company will be positive. The probability of meeting the financial needs of the company turns to be favourable.

Conclusion

Hence, the difference between current liability and long-term debt are explained above.

Answer 6

Chapter 13, Problem 1Q

To determine

Current liability: Current liability refers to the debts of an organization. It is an obligation of the company that is due to be paid within one year.

Long-term debt: Long-term debt refers to the obligations of a firm that are due and has a due period exceeding a year.

To determine the difference between current liability and long-term debt.

Expert Solution & Answer

Explanation of Solution

Both current liabilities and long-term debts act as a focal point of the financial planning efforts of an organization.

Current liabilities are obligations to be paid within a year. If the debts are paid within the stipulated period, the short-term liability of the company is found to be positive. This means that the company meets the cash flow needs and it is considered as a going concern.

Long-term debts are obligations for which the due period exceeds 1 year. If the debts are paid within the stipulated period, the long-term liquidity of the company will be positive. The probability of meeting the financial needs of the company turns to be favourable.

Conclusion

Hence, the difference between current liability and long-term debt are explained above.

Answer 7

Chapter 13, Problem 1Q

To determine

Current liability: Current liability refers to the debts of an organization. It is an obligation of the company that is due to be paid within one year.

Long-term debt: Long-term debt refers to the obligations of a firm that are due and has a due period exceeding a year.

To determine the difference between current liability and long-term debt.

Answer 8

Expert Solution & Answer

Explanation of Solution

Both current liabilities and long-term debts act as a focal point of the financial planning efforts of an organization.

Current liabilities are obligations to be paid within a year. If the debts are paid within the stipulated period, the short-term liability of the company is found to be positive. This means that the company meets the cash flow needs and it is considered as a going concern.

Long-term debts are obligations for which the due period exceeds 1 year. If the debts are paid within the stipulated period, the long-term liquidity of the company will be positive. The probability of meeting the financial needs of the company turns to be favourable.