Chapter 11, Problem E11.23E

To determine

Accounting treatment for contingencies: The contingent liabilities are the potential liabilities that may arise, depending on the outcome of an uncertain future event. Example warranty claims may arise only if there is some repair or replacement for the goods sold.

There are three levels of the contingent liabilities and depending on the levels, the accounting treatment is done.

Level	Accounting treatment
Probable	To be accrued
Reasonably possible	To be shown in footnotes
Remote	To be ignored.

To determine:

The accounting treatment of the given independent situations.