Question 8 A contingent liability must be disclosed in the body of the financial statements, including...
Question 8
-
A contingent liability
must be disclosed in the body of the financial statements, including the expected dollar amount.
can always be calculated with great precision (i.e., always has a definite amount).
is not of interest to readers of financial statements.
include liabilities for warranty repairs.
is a potential liability that depends on a future event arising out of a past transaction.
Homework Answers
| A contingent liability is a potential liability that depends on a future event arising out of a past transaction. |
| A contingent liability is recognized when it is probable and amount can be reasonably estimated. |
| Examples of contingent liability include tax disputes, lawsuits, guarantees of debt, etc. |
| Option E is correct |
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Question 8
A contingent liability
must be disclosed in the body of the financial statements,
including...
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