Answer Posted / soumya

company's debts or obligations that are due within one
year. Current liabilities appear on the company's balance
sheet and include short term debt, accounts payable,
accrued liabilities and other debts.

Essentially, these are bills that are due to creditors and
suppliers within a short period of time. Normally,
companies withdraw or cash current assets in order to pay
their current liabilities.

Analysts and creditors will often use the current ratio,
(which divides current assets by liabilities), or the quick
ratio, (which divides current assets minus inventories by
current liabilities), to determine whether a company has
the ability to pay off its current liabilities

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