Chapter K, Problem 2Q

To determine

Other significant liabilities

Other significant liabilities are liabilities other than current and long-term liabilities. These liabilities have a significant impact on the future cash flows and financial position of the company. Contingent liabilities, lease liabilities and additional liabilities for employee fringe benefits are the examples of other significant liabilities.

Contingent liability

The contingent liability is not treated as a liability of the company on the date of the balance sheet but it may become liabilities in the future date on the happening of an ambiguous event.

To Find: The circumstances is a contingent liability disclosed only in the notes to the financial statements.

To determine

To Find: The circumstances is a contingent liability not recorded in the accounts nor disclosed in the notes to the financial statements.