Liabilities are best defined as ____________ .

Liabilities are best defined as obligations owed to creditors. This definition highlights the nature of liabilities as financial responsibilities that a company has to outside parties. When a company borrows funds, purchases goods on credit, or has contractual obligations, it incurs liabilities that must be settled in the future, typically through the payment of cash or delivery of goods and services.

This understanding is crucial in the context of accounting and financial reporting, where liabilities are recorded on the balance sheet and represent a key component of a company's obligations alongside its assets and equity. By recognizing liabilities in this way, stakeholders can better assess the financial health of a business, understanding how much the company owes versus what it owns.

In contrast, the other options pertain to different aspects of a company's financial structure. Assets refer to what a company owns, equity represents the ownership interest of shareholders, and investments in stock involve the acquisition of shares in other companies. Each of these relates to a company's financial position but does not capture the essence of liabilities as obligations owed to creditors.