Contingent Liability Contingent liability is one form of liability that arises based on a particular outcome of a specific event. They are possible obligation that might arise or might not arise based on the future events. It is otherwise called as probable liability or eventual liability. Following are examples of contingencies: Income tax disputes Discounted notes receivable Lawsuits Debt guarantees Failure to follow government regulations To obtain: a relevant authoritative literature on recognition of contingent losses.

Question

Want to see the full answer?

Answer 1

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 13, Problem 13.14E

(1)

To determine

Contingent Liability

Contingent liability is one form of liability that arises based on a particular outcome of a specific event. They are possible obligation that might arise or might not arise based on the future events. It is otherwise called as probable liability or eventual liability. Following are examples of contingencies:

Income tax disputes

Discounted notes receivable

Lawsuits

Debt guarantees

Failure to follow government regulations

To obtain: a relevant authoritative literature on recognition of contingent losses.

(2)

To determine

To list: the guidelines

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

I want to correct answer general accounting

Can you help me with accounting questions

Acorn Construction (calendar-year-end C corporation) has had rapid expansion during the last half of the current year due to the housing market's recovery. The company has record income and would like to maximize its cost recovery deduction for the current year. (Use MACRS Table 1, Table 2, Table 3, Table 4, and Table 5.) Note: Round your answer to the nearest whole dollar amount. Acorn provided you with the following information: Asset Placed in Service Basis New equipment and tools August 20 $ 3,800,000 Used light-duty trucks October 17 2,000,000 Used machinery November 6 1,525,000 Total $ 7,325,000 The used assets had been contributed to the business by its owner in a tax-deferred transaction two years ago. a. What is Acorn's maximum cost recovery deduction in the current year?

Answer 2

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 13, Problem 13.14E

(1)

To determine

Contingent Liability

Contingent liability is one form of liability that arises based on a particular outcome of a specific event. They are possible obligation that might arise or might not arise based on the future events. It is otherwise called as probable liability or eventual liability. Following are examples of contingencies:

Income tax disputes

Discounted notes receivable

Lawsuits

Debt guarantees

Failure to follow government regulations

To obtain: a relevant authoritative literature on recognition of contingent losses.

(2)

To determine

To list: the guidelines

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

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 13, Problem 13.14E

(1)

To determine

Contingent Liability

Contingent liability is one form of liability that arises based on a particular outcome of a specific event. They are possible obligation that might arise or might not arise based on the future events. It is otherwise called as probable liability or eventual liability. Following are examples of contingencies:

Income tax disputes

Discounted notes receivable

Lawsuits

Debt guarantees

Failure to follow government regulations

To obtain: a relevant authoritative literature on recognition of contingent losses.

(2)

To determine

To list: the guidelines

Expert Solution & Answer

Want to see the full answer?

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 13, Problem 13.14E

(1)

To determine

Contingent Liability

Contingent liability is one form of liability that arises based on a particular outcome of a specific event. They are possible obligation that might arise or might not arise based on the future events. It is otherwise called as probable liability or eventual liability. Following are examples of contingencies:

Income tax disputes

Discounted notes receivable

Lawsuits

Debt guarantees

Failure to follow government regulations

To obtain: a relevant authoritative literature on recognition of contingent losses.

(2)

To determine

To list: the guidelines

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 13, Problem 13.14E

(1)

To determine

Contingent Liability

Contingent liability is one form of liability that arises based on a particular outcome of a specific event. They are possible obligation that might arise or might not arise based on the future events. It is otherwise called as probable liability or eventual liability. Following are examples of contingencies:

Income tax disputes

Discounted notes receivable

Lawsuits

Debt guarantees

Failure to follow government regulations

To obtain: a relevant authoritative literature on recognition of contingent losses.

(2)

To determine

To list: the guidelines

Answer 6

Chapter 13, Problem 13.14E

(1)

To determine

Contingent Liability

Contingent liability is one form of liability that arises based on a particular outcome of a specific event. They are possible obligation that might arise or might not arise based on the future events. It is otherwise called as probable liability or eventual liability. Following are examples of contingencies:

Income tax disputes

Discounted notes receivable

Lawsuits

Debt guarantees

Failure to follow government regulations

To obtain: a relevant authoritative literature on recognition of contingent losses.

Answer 7

Chapter 13, Problem 13.14E

(1)

To determine

Contingent Liability

Contingent liability is one form of liability that arises based on a particular outcome of a specific event. They are possible obligation that might arise or might not arise based on the future events. It is otherwise called as probable liability or eventual liability. Following are examples of contingencies:

Income tax disputes

Discounted notes receivable

Lawsuits

Debt guarantees

Failure to follow government regulations

To obtain: a relevant authoritative literature on recognition of contingent losses.

Answer 8

(2)

To determine

To list: the guidelines

Answer 9

(2)

To determine

To list: the guidelines

Answer 10

Expert Solution & Answer

Answer 11

Expert Solution & Answer

Answer 12

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 13

Ch. 13 - What are the essential characteristics of...Ch. 13 - Prob. 13.2Q Ch. 13 - Bronson Distributors owes a supplier 100,000 on...Ch. 13 - Bank loans often are arranged under existing lines...Ch. 13 - Prob. 13.5Q Ch. 13 - Prob. 13.6Q Ch. 13 - Salaries of 5,000 have been earned by employees by...Ch. 13 - Prob. 13.8Q Ch. 13 - Prob. 13.9Q Ch. 13 - Prob. 13.10Q

Solution Summary: The author explains the guidelines for accruing loss contingencies.

To list: the guidelines

Want to see the full answer?

Chapter 13 Solutions