Chapter 9, Problem 1DQ

To determine

Current liability:

Current Liability are those liability which is payable by the company within the one year. These liabilities are shown in the balance sheet of the company such as received in advance, outstanding expenses, account payable, and creditor.

Long term liability: Long Term liabilities are those liability which is payable after the one year and more. These liabilities are shown in the balance sheet of the company such as long term loans and borrowings, equity and preference share and long term bonds.

To explain: distinction between current and long term liability.