For a current liability to exist, the following two tests must be met. The liability must be due usually within a year and must be paid out of current assets.

Name: For a current liability to exist, the following two tests must be met. The liability must be due usually within a year and must be paid out of current assets.
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For a liability to be considered a current liability, it must meet both criteria of being due within a year and being paid out of current assets.

For a Current Liability to Exist, the Following Two Tests