Question

Define the term “liability” and provide an example of an asset within the context of a university environment. – 2 marks

Answer 1

Liability refers to a financial obligation or debt that an entity owes to another party. In a university environment, a liability could refer to outstanding debts for construction projects, student loans, or employee salaries.

Example of an asset in a university environment could be the university's endowment fund, campus buildings, or research equipment.