What does total liabilities mean on the CPA exam?
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Total liabilities. Everything the entity owes, added up. Total assets less total liabilities is equity.
Related terms
- total assets: Everything the entity controls that is expected to produce future benefit, added up.
- partnership liabilities: Debt of the partnership, allocated among the partners and added to their outside basis.
- balance sheet: A snapshot at one date of what the entity owns, what it owes, and the owners' residual.
- rights and obligations: The assertion that the entity genuinely owns the assets it reports and genuinely owes the liabilities.
- net assets: Assets less liabilities.
- net position: A government's assets plus deferred outflows, less liabilities and deferred inflows.