**Quiz: Accounting for Current Liabilities** --- **Knowledge Check 01** A potential legal claim which is probable and the amount can be reasonably estimated should be: - ○ recorded in the financial statements as a contingent liability. - ○ disclosed in the notes while the lawsuit is outstanding. - ○ disclosed in the notes when the lawsuit is settled. - ○ is a potential liability that has arisen because of a past event or transaction. --- **Navigation** - Prev [17 of 19] Next --- This question assesses understanding of when and how potential legal claims should be reported in financial statements, focusing on the concept of contingent liabilities.

Quiz: Accounting for Current Liabilities --- Knowledge Check 01 A potential legal claim which is probable and the amount can be reasonably estimated should be: - ○ recorded in the financial statements as a contingent liability. - ○ disclosed in the notes while the lawsuit is outstanding. - ○ disclosed in the notes when the lawsuit is settled. - ○ is a potential liability that has arisen because of a past event or transaction. --- Navigation - Prev [17 of 19] Next --- This question assesses understanding of when and how potential legal claims should be reported in financial statements, focusing on the concept of contingent liabilities.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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