Which of the following is typically a current liability on a balance sheet?

• A. Bank loan repayable in more than 12 months
• B. Accruals and deferred income
• C. Intangible asset
• D. Share capital

Answer: (B)

Current liabilities are obligations a business expects to settle within one year (or the operating cycle). Accruals and deferred income fit this category because accruals are expenses recognized but not yet paid (a payable due soon), and deferred income is cash received before delivering goods or services, which remains a liability until the obligation is satisfied. In contrast, a bank loan that is repayable in more than a year is a long-term liability, an intangible asset is an asset, and share capital is part of equity.