what does delay payment of liabilities mean? and what is a good example of this?
Delaying payment of liabilities refers to the act of postponing the settlement of debts or obligations. It means that instead of paying the liabilities on the scheduled due date, the payment is deferred to a later date.
A good example of delaying payment of liabilities is when a company faces financial difficulties and chooses to negotiate with its suppliers or creditors to extend the payment terms. For instance, if a business owes money to a supplier with a payment due date of 30 days, the company might approach the supplier and request an extension to pay the amount after 60 days. By doing so, the company can temporarily alleviate its cash flow issues and have more time to manage its financial obligations.