Final answer:
Long-term payables are money loaned to a firm that must be paid back. Firms borrow money through banks and bonds.
Step-by-step explanation:
Long-term payable are long-term liabilities that represent money loaned to the firm that must be paid back. These payables are typically in the form of loans or bonds.
When a firm has a record of earning significant revenues or profits, it becomes possible for the firm to borrow money. Banks and bonds are two main borrowing methods for firms.
For banks, loans are assets because the borrower has a legal obligation to make payments over time. Banks issue home loans, charge handling fees, and sell these loans to other banks or financial institutions in the secondary loan market. The primary loan market is where financial institutions make loans to borrowers.