What are Long-term liabilities?
Long-term liabilities (Definition)
Long-term liabilities are the sum of all the money owed to other persons by a business, over a longer period. They generally extend past 12 months (with current liabilities due within 12 months). When a business lists long-term liabilities in their accounts, the current portion of this debt is separated from the rest of the debt. This allows business owners to see how much money the business has right now and whether it can pay its current debts when they are due. On a balance sheet, your long term liabilities and short term liabilities are added together to determine a business’ total debt.
Examples of long-term liabilities include:
- Long term loans
- Bonds payable
- Deferred revenue
- Deferred taxes
- Customer deposits