A current liability is a debt that can reasonably be expected to be paid
A) within one year or the operating cycle whichever is longer.
B) between 6 months and 18 months.
C) out of currently recognized revenues.
D) out of cash currently on hand.

Question

Quizplus · Accepted Answer

According to generally accepted accounting principles (GAAP), a current liability is a debt that is expected to be paid within one year or the operating cycle, whichever is longer. This means that the liability is due within a relatively short period of time (usually within one year) or within the normal operating cycle of the business, which can be longer than one year for some industries. The other options are not accurate definitions of a current liability according to GAAP.

A Current Liability Is a Debt That Can Reasonably Be