Contents tagged with liability

  • Liabilities in Accountancy

    Hello everybody,

    now let's go for liability definition.

    Liability in accountancy word definition is like this: present obligation of the firm to transfer economic benefits in the future to another party that arise from a past event or transaction.

    Definition has following key parts:

    present obligation

    transfer benefits

    past transaction event

    From this standpoint bank loan is liability. 

    Potential lawsuite without estimated fine size can't be liability, but definetly should be mentioned in footnotes of balance sheet. 

    3 years warranty is also liability. For example warranty for the car. And if company can estimate their obligations on warranty then those kind of liabilities are … more