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Accounting For Fun and Profit by Lawrence A. Weiss

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CHAPTER 7

Current Liabilities

The accounting for current liabilities may seem familiar because many of the accounts are mirror images of those in current assets. With current liabilities, a firm is on the opposite side of the transaction from that of current assets. Instead of selling, using, or converting something to cash within a year as it does with current assets, the firm has purchased something and must pay for it within a year or has received prepayment and must provide goods or services within a year. Current liabilities are current obligations to transfer assets or provide services in the next year and will generally be satisfied with current assets. Common examples of current liabilities are discussed below.

Bank Debt

Bank debt is ...

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