One of the advantages of long-term debt is that the interest paid for the loan can be included in the tax deductibles. While the interest rates for long-term debt are higher compared to that of short-term debt, the longer duration is beneficial to repay the principal amount.
Examples for long-term debts include bank loans, mortgages, bonds, debentures, etc. All these different types of debts are ranked in the order of their repayment priority on the balance sheets of a company.
When the due date of long-term debts comes under 12 months, they’re moved to the current liabilities section of the balance sheet.