A business asset is defined as an economic resource that can be used to generate value and profits, while a business liability refers to any financial obligation that must be fulfilled in order to keep the business running. Assets are typically classified according to their degree of liquidity, which means how easily they can be transformed into cash. Common examples of business assets include cash, inventory, buildings and equipment, trademarks, patents, and customer relationships. Business liabilities, meanwhile, can range from short-term obligations such as accounts payable to long-term debt like loans and mortgages. They must be paid off over time or else the business will be at risk of defaulting on them. By taking stock of both their assets and liabilities, businesses can better manage their finances and ensure their success.