Contingent Liability : Sometimes companies are not sure if a particular liability is certain or not because of its time and other market or company related factors. These types of liabilities are called contingent liabilities. To Identify: The circumstances to report a contingent liability in notes to financial statements and not to report anywhere.

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Definition Definition Costs that a business is responsible for paying, should a particular event potentially occur in the future. Also called a potential liability, a contingent liability is generally recorded only when the amount of liability can be reasonably estimated and the contingency is likely to occur shortly. The Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Principles (IFRS) make it mandatory for the companies to record any contingent liability taking the principles of full disclosure, materiality, and prudence into consideration.

Chapter 11, Problem 7Q

To determine

Contingent Liability: Sometimes companies are not sure if a particular liability is certain or not because of its time and other market or company related factors. These types of liabilities are called contingent liabilities.

To Identify: The circumstances to report a contingent liability in notes to financial statements and not to report anywhere.

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Definition Definition Costs that a business is responsible for paying, should a particular event potentially occur in the future. Also called a potential liability, a contingent liability is generally recorded only when the amount of liability can be reasonably estimated and the contingency is likely to occur shortly. The Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Principles (IFRS) make it mandatory for the companies to record any contingent liability taking the principles of full disclosure, materiality, and prudence into consideration.

Chapter 11, Problem 7Q

To determine

Contingent Liability: Sometimes companies are not sure if a particular liability is certain or not because of its time and other market or company related factors. These types of liabilities are called contingent liabilities.

To Identify: The circumstances to report a contingent liability in notes to financial statements and not to report anywhere.

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Answer 3

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Definition Definition Costs that a business is responsible for paying, should a particular event potentially occur in the future. Also called a potential liability, a contingent liability is generally recorded only when the amount of liability can be reasonably estimated and the contingency is likely to occur shortly. The Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Principles (IFRS) make it mandatory for the companies to record any contingent liability taking the principles of full disclosure, materiality, and prudence into consideration.

Chapter 11, Problem 7Q

To determine

Contingent Liability: Sometimes companies are not sure if a particular liability is certain or not because of its time and other market or company related factors. These types of liabilities are called contingent liabilities.

To Identify: The circumstances to report a contingent liability in notes to financial statements and not to report anywhere.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 4

Question

Definition Definition Costs that a business is responsible for paying, should a particular event potentially occur in the future. Also called a potential liability, a contingent liability is generally recorded only when the amount of liability can be reasonably estimated and the contingency is likely to occur shortly. The Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Principles (IFRS) make it mandatory for the companies to record any contingent liability taking the principles of full disclosure, materiality, and prudence into consideration.

Chapter 11, Problem 7Q

To determine