Which component represents future obligations to creditors on a balance sheet?

Liabilities represent future obligations to creditors on a balance sheet because they consist of amounts that the company owes to external parties, including loans, accounts payable, mortgages, and other debts. This category captures all financial responsibilities that are settled over time through the transfer of economic benefits, such as cash or services.

In the context of a balance sheet, liabilities provide insight into how a company finances its operations and growth, indicating the level of risk associated with its debt obligations. When analyzing a company's financial health, understanding liabilities is crucial, as it reflects the obligations the company must meet in the future.

Assets, on the other hand, represent resources owned by the company that can provide future economic benefits, while equity refers to the residual interest in those assets after deducting liabilities. Net income, on the other hand, pertains to profitability over a specific period, reflecting the company’s performance rather than its obligations.