resent obligation is not a contingent liability but shall be recognized as a provision when * a. Amount is reasonably estimable and event occurs infrequently b. Amount is reasonably estimable and occurrence of event is probable c. Event is unusual in nature and occurrence of event is probable d. Event is unusual in nature and event occurrs infrequently

resent obligation is not a contingent liability but shall be recognized as a provision when * a. Amount is reasonably estimable and event occurs infrequently b. Amount is reasonably estimable and occurrence of event is probable c. Event is unusual in nature and occurrence of event is probable d. Event is unusual in nature and event occurrs infrequently

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter12: Current Liabilities

Section: Chapter Questions

Problem 11MC: Which of the following best describes a contingent liability that is unlikely to occur? A. remote B....

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Similar questions

Suppose the analysis of a loss contingency indicates that an obligation is not probable. What accounting treatment if any is warranted?
An estimated liability is an obligation which is uncertain as to: * A. NO - amount; YES - existence B. YES - amount; YES - existence C. NO - amount; NO - existence D. YES - amount; NO – existence
Which of the following best describes a contingent liability that is unlikely to occur? A. remote B. probable and estimable C. reasonably possible D. probable and inestimable
The accrual of a contingent liability and the related loss should be recorded when the a. Loss resulting from a future event may be material in relation to income. b. Future event that gives rise to the liability is unusual in nature and nonrecurring. c. Amount of the loss resulting from the event is reasonably estimated and the occurrence of the loss is probable. d. Event that gives rise to the liability is unusual and its occurrence is probable.
Under IFRS, a liability is recorded if the chance of occurrence is Select one: A. probable. B. likely. C. undeterminable. D. unlikely.
A provision should be recognized when: O a. Present obligation from a past event, outflow that will be required to settle, and Reliable estimate can be made. O b. There is contingency. O C. Estimate is made and there is evidence readily available. O d. After the event has been follow through and there is a liability present.
A contingent liability O always exists as a liability but its amount and due date are indeterminable. O is accrued even though not probable. O is always the result of a loss contingency. O is not reported as a liability if not probable.
A provision is an existing liability of uncertain timing and uncertain amount True False
An obligation that is contingent on the occurrence of a future event should be reported in the statement of financial position as a liability if: a. The amount of the obligation can be reasonably estimated. b. The future event is likely to occur. c. The occurrence of the future event is at least reasonably possible and the amount is known d. The occurrence of the future event is probable and the amount can be reasonably estimated.
1. Which of the following is not an essential characteristic of a liability? * a. It is a present obligation that entails settlement by probable future transfer or use of cash, goods or services. b. The liability must be an unavoidable obligation. c. The transaction or other event creating the obligation must have already occurred. d. The obligation must be settled to an identifiable party.
Which of the following best describes a contingent liability that is unlikely to occur?A. remoteB. probable and estimableC. reasonably possibleD. probable and inestimable
State with reason whether the following statements are true or false Contingent liability is an ascertained liability but its amount and due date are indeterminate.