Liabilties

• Liabilites are debts that the business owes to someone else
• There are 2 kinds of Liabilities

  1. Non current
  2. Current
• A Non-current liabilty is a long term loan e.g. morgage loan
• Current Liability is a trade and other payables (creditors) or a bank overdraft
• Liabilities decrease when you debit as you owe less
• Liabilties increase when you credit as you owe more