Finance / July 12, 2018 / Isabella Mccray
Liability is a financial obligation made by a company to pay certain amount for the goods or services received by the company in the past. The short-term legal agreements which are required to be paid within one year are referred as current liabilities. Current liabilities are reported under liabilities on balance sheet.
As discussed cash flows can either be positive or negative. It is calculated by subtracting the cash balance at the beginning of a period which is also known as opening balance, form the cash balance at the end of the period (could be a month, quarter or a year) or the closing balance.
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