Liabilities

Liabilities are those amounts owed by a business at any one time and shown on the Balance Sheet. Liabilities are often expressed as "payables."

Liabilities are usually separated into two types:

• Long-term Liabilities
  Long-term liabilities are those obligations of the business which are expected to continue for more than one year. These include loans payable and mortgages payable.
  
  
• Short-term Liabilities
  Short-term liabilities are those obligations of the business which are expected to be paid off within a year. These include
  
  • Sales taxes payable
    These amounts are collected from customers at time of sale and held until due to be paid to the appropriate state revenue department.
    
  • Payroll taxes payable
    These amounts are collected from employees (withholding from income taxes and for employment taxes) and set aside by the employer, to be paid at the appropriate time to the IRS or state tax agencies.
    
  • Loans and mortgages payable
    These are the monthly payments on loans and mortgages.