Accounting 101, Lesson #13: Liability Accounts

Hi guys, what's up?

Hope everything's fine.

As I've promised in our previous lesson (which you can see here), I'll be giving you a list of commonly used, generally accepted liability account titles.

So here it is, enjoy!!

• Accounts payable - is an obligation of the entity to pay a sum amount of money, that arises from the buying of goods and services on credit terms in the ordinary course of the business.
• Loans payable - obligations of an entity that arises from the borrowing of money from a lender.
• Unearned revenues - obligations to supply goods and services that is a result of advance payments of customers.
• Notes payable - almost the same as accounts payable, the only difference however is the fact that the liability is evidenced by a non-negotiable promissory note.
• Mortgage payable - obligations for long term borrowing in which a fixed asset, usually a land or building is use as a collateral.
• Salaries and wages payable - are obligations to employees to pay an agreed just compensation for rendering services for the entity.

Per accounting standards the account title accrued expense payable can be re-classified as; accrued utilities payable, accured rent payable, accrued salaries payable so on and so forth.

Other examples are as follows;

Taxes payable, customer's refundable deposits, advances from clients, loans payable to partners, loans payable to associates, interest payable.

So that's about it, those were just a few examples but I'm sure it'll prove helpful in our succeeding lessons.

Next time, we'll feast ourselves with a lesson regarding owner's equity.

For now, I bid farewell.

Until then.