What are current liabilities defined as?

Current liabilities are indeed defined as obligations that a business is required to settle within a short time frame, typically within one year. This classification includes various financial obligations such as accounts payable, short-term loans, and other debts that need to be paid in the near term. Understanding current liabilities is crucial for evaluating a company's short-term financial health and liquidity, as it shows how well a company can meet its immediate financial obligations using its current assets.

In contrast, the other definitions do not accurately reflect the nature of current liabilities. Liabilities due in more than one year pertain to long-term obligations and would not be classified as current. Long-term obligations extending beyond a year also reflect a different category of liabilities altogether. Lastly, the notion that current liabilities consist only of secured debts is misleading. Current liabilities can encompass both secured and unsecured debts, as the key factor for classification is the time frame for repayment rather than the security of the obligation.