Which of the following accounts is NOT a Current Liability?

In accounting, a current liability is defined as a financial obligation that is expected to be settled within one year or within the operating cycle of the business, whichever is longer. Current liabilities include items that the company needs to pay off in the near future, such as outstanding bills or obligations.

A mortgage, on the other hand, typically represents a long-term liability. Mortgages are loans taken out to purchase property, and they are usually paid back over a period that extends beyond one year. While there may be a portion of the mortgage payment that is due in the current year (like a portion of the principal) that might qualify as a current liability, the mortgage itself as an account does not classify as a current liability because its total balance is primarily long-term due to the repayment schedule.

This distinction is crucial because it helps in assessing the short-term financial health of a business. Understanding the difference between current and long-term liabilities is essential for proper financial analysis, as it impacts liquidity ratios and the overall financial position of the entity.