What are business liabilities?

Business liabilities are, by definition, the amounts owed by a business at any one time. They're often expressed as "payables" for accounting purposes. Unless you're running a complete cash business (paying and collecting only cash), your business probably has liabilities.

What is a liability to you?

What is a liability to you is an asset to the party you owe. You can think of liabilities as claims that other parties have to your assets. On a company balance sheet, liabilities and assets are listed side by side. Liabilities are sorted into two general categories: current and long-term liabilities.

How do I know if my business liabilities are manageable?

Businesses can incur both short-term liabilities, such as sales taxes payable and payroll taxes payable, and long-term liabilities, such as loans and mortgages. You can use the current ratio, debt-to-equity ratio, and debt-to-asset ratio to determine whether your liabilities are manageable or need to be lowered.

What are assets & liabilities?

Assets and liabilities are used to evaluate your business’s financial standing, and to show its equity by subtracting your company’s liabilities from its assets. For these reasons, it’s important to have a good understanding of what business liabilities are and how they work.