Ceramic Products, Inc. reports these account balances at January 1, 2015 (shown in alphabetical order):
On January 5, Ceramic Products collected $12,000 of its accounts receivable and paid $11,000 on its note payable. What are total liabilities on January 6, 2015?
Current liabilities are expected to be settled in the normal course of the operating cycle or are due to be settled within 12 months. Certain liabilities, such as trade payable and capital accruals for various operating costs, are part of working capital, and are deemed to be current even if they are due to be settled in more than 12 months. Other liabilities, such as the current portion of long-term debt, are not settled as part of the current operating cycle but are classified as current because they are due within 12 months.
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from Financial Accounting: Help and ReviewChapter 8 / Lesson 6