221k views
4 votes
Which component of a balance sheet includes a business’s debts, or the money that it owes to creditors for past transactions?

User Ifeins
by
7.8k points

1 Answer

6 votes

Answer:

liabilities.

Step-by-step explanation:

A balance sheet is prepared based on the accounting equation of assets = capital + liabilities.

The liability section is where the debts of the business are recorded. Liabilities represent what the business owes to suppliers and other third parties. They are expressed in monetary value. Liabilities are further subdivided into current and long term liabilities.

User Siamand
by
8.2k points