 Welcome to Unit 8 of Sailor.org's Introduction to Financial Accounting. This unit is divided into three subunits and will take about three hours to complete. We're going to focus on what we call liabilities and how they are recorded in a company's financial statements. The concept of a liability is all around us in our everyday life. Do you have a bill or do you owe money to someone? If so, then you have a liability that you must fulfill. Companies often have lots of liabilities like money owed to a vendor for materials purchased or money owed to a bank for a startup loan. This unit will explain the difference between current liability or money owed within 12 months and long-term liability which is owed over a longer time frame. We will also give you examples to help you understand what constitutes each type of liability. One type of liability that we'll discuss is a bond. Some companies may choose not to take out a loan from a bank and instead to generate money by selling bonds to shareholders. Basically, the company is promising to pay the face value of a bond as well as interest on that bond to the shareholder over an extended period of time. By the end of this unit, you should be able to define how bonds are priced and why they are preferred in some instances to using traditional loans. Okay team, we're almost there. We're in the final stretch of this course. In the last two units of this course, you will take everything you've learned so far and apply it to financial statement analysis. Being able to understand financial terms and how they affect the inner workings of a company is valuable information and now you have it.