Current Debt

Borrowings with a maturity of less than one year

Current Debt

Current debt includes the formal borrowings of a company outside of accounts payables. This appears on the balance sheet as an obligation that must be paid off within a year’s time. Thus, current debt is classified as a current liability. This is not to be confused with the current portion of long-term debt, which is the portion of long-term debt due within a year’s time.

Current Debt

 

Not all companies have a current debt line item, but those that do use it as explicitly loans that were incurred with a maturity of less than a year. Some firms call this notes payable. This differs from accounts payable, as accounts payable refers to goods or services borrowed on credit. Notes payable, on the other hand, refers to funds or cash borrowed on credit.

 

Learn more about the Balance Sheet

We hope this guide has been helpful in your understanding of financial statements.  To continue learning about the balance sheet please see these additional articles that will help to increase your knowledge: