Monetary liability definition
/What is a Monetary Liability?
A monetary liability is a fixed obligation to pay. The amount of this obligation does not depend on the outcome of future events. The amount to be paid is typically stated in a contract, invoice, or employment agreement.
Examples of Monetary Liability
Examples of monetary liabilities are as follows:
Trade payables. These are amounts billed to a company by its suppliers for goods delivered to or services consumed by the company in the ordinary course of business.
Notes payable. This is a written promissory note. Under this agreement, a borrower obtains a specific amount of money from a lender and promises to pay it back with interest over a predetermined time period.
Wages payable. This is hourly compensation earned by employees but not yet paid.
In every case, the amount of the obligation to be paid is clearly stated in, respectively, a supplier invoice, a loan agreement, and a payroll record.