What are liabilities?

Liabilites can be seen as the opposite of assets.  While
an asset is something that has economic value to a firm, a liability is something that
the firm owes to someone else.  Liabilities, then, are the debts or obligations that a
firm incurs in the course of its business operations.

There
can be many kinds of liabilities.  There are current liabilities, which must be paid off
in the short term.  These include such things as wages owed to workers and taxes owed to
the government.  There are long term liabilities that do not need to be paid off within
a year.  These include such things as mortgages.  Finally, there are contingent
liabilities.  These are things that the firm may or may not have to pay at some point. 
This could include something like the damages a firm would have to pay in the event that
it loses a lawsuit.

What all of these have in common is
that they are obligations that are owed by the firm in question.