Short-Term Debt


DEFINITION of 'Short-Term Debt'

An account shown in the current liabilities portion of a company's balance sheet. This account is comprised of any debt incurred by a company that is due within one year. The debt in this account is usually made up of short-term bank loans taken out by a company.

BREAKING DOWN 'Short-Term Debt'

The value of this account is very important when determining a company's financial health. If the account is larger than the company's cash and cash equivalents, this suggests that the company may be in poor financial health and does not have enough cash to pay off its short-term debts. Although short-term debts are due within a year, there may be a portion of the long-term debt included in this account. This portion pertains to payments that must be made on any long-term debt throughout the year.

  1. Cash

    Legal tender or coins that can be used to exchange goods, debt ...
  2. Balance Sheet

    A financial statement that summarizes a company's assets, liabilities ...
  3. Long-Term Debt

    Long-term debt consists of loans and financial obligations lasting ...
  4. Capital Note

    Short-term unsecured debt generally issued by a company to pay ...
  5. Cash And Cash Equivalents - CCE

    An item on the balance sheet that reports the value of a company's ...
  6. Current Liabilities

    A company's debts or obligations that are due within one year. ...
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