Liabilities are?

Liabilities are?

• A. what you own
• B. assets
• C. what you owe
• D. revenues

Answer: (C)

Liabilities are obligations the entity owes to others that will require future sacrifices of economic benefits, such as paying back loans, settling accounts payable, or covering accrued expenses. This describes what the company owes, which is why that option is correct. The other descriptions don’t fit: what you own refers to assets, assets themselves are things of value owned, and revenues are income earned from business activities, not obligations to pay.

Liabilities are obligations the entity owes to others that will require future sacrifices of economic benefits, such as paying back loans, settling accounts payable, or covering accrued expenses. This describes what the company owes, which is why that option is correct. The other descriptions don’t fit: what you own refers to assets, assets themselves are things of value owned, and revenues are income earned from business activities, not obligations to pay.