Determining if an obligation is a current liability requires careful consideration of certain conditions. Examine the following
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Determining if an obligation is a current liability requires careful consideration of certain conditions. Examine the following five conditions, and determine what other conditions must be met before the obligation would be deemed current (Condition A is done as an example):
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A B Condition Obligation is due within one year Obligation is due within the operating cycle C Obligation requires the use of current assets D Obligation results in the creation of another current liability E Obligation to be satisfied by providing services Other Conditions to meet: C, D, or E
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