What term is used to describe a company's obligations or debts?

The term that is used to describe a company's obligations or debts is liabilities. Liabilities represent the financial responsibilities that a company has to outside parties, which can include loans, accounts payable, mortgages, and other forms of debt. Understanding liabilities is crucial for assessing a company's financial health and determining its net worth.

In financial terms, liabilities are contrasted with assets, which are the resources owned by the company that have economic value. While net worth is a measure of a company’s total assets minus its total liabilities, proprietorship typically refers to ownership interest in a business. Therefore, liabilities stand out as the correct answer because they specifically denote obligations or debts rather than the ownership structure or asset holdings of the company.