Chapter 11, Problem 9QC

To determine

Contingent Liability:

A Contingent Liability, as the name suggests, is a liability that may or may not arise in future on the basis of events that have occurred in the past. The amount of potential loss that this liability may incurr is uncertain. Law suits, Product warranties are the examples of Contingent Liability.

Treatment with regard to disclosure of Contingent Liability in the books of Swell Company