Social Sciences, asked by tejastej2797, 1 year ago

Distinguish between fixed liability and current liability

Answers

Answered by Rituj1
1
A. Current liabilities consist of only accounts payable to vendors and suppliers that fall due within the coming year​ (or within one operating​ cycle, if longer than a​ year). Long-term liabilities fall due beyond 1 year from the balance sheet​ date, or beyond the operating cycle​ (if longer than 1​ year).

B. Current liabilities are obligations that fall due within the coming year​ (or within one operating​ cycle, if longer than a​ year). Long-term liabilities fall due beyond 1 year from the balance sheet​ date, or beyond the operating cycle​ (if longer than 1​ year).

C. Current liabilities are obligations that fall due within between 1 and 3 years.​ Long-term liabilities fall due beyond 3 years from the balance sheet date.

D. Current liabilities consist of only bank loans that fall due within the coming year​ (or within one operating​ cycle, if longer than a​ year). Fixed liabilities are only bank loans that fall due beyond 1 year from the balance sheet​ date, or beyond the operating cycle​ (if longer than 1​ year).

Answered by vijaylexi1
3

A debt, bond or a loan that is payable over a term exceeding one year, is known as fixed liability, while current liability is that is which a debt, bond or a loan is payable in a short time, i.e., within the next one financial year.

Explanation:

Differences between Fixed Liability and Current Liability-

  • Fixed liabilities have long repayment terms in excess of 1 year, while current liabilities have credit period of less than 12 months.
  • Fixed liabilities appear in more than one balance sheet, while current liabilities appear in one balance sheet.
  • Fixed liabilities have generally interest attached to them, while current liabilities have generally no interest attached.

#SPJ2

Similar questions