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mario62 [17]
3 years ago
10

A contingent liability should be recorded in a company's financial statements only if the likelihood of a loss occurring is_____

_____.
a. At least reasonably possible and the amount of the loss is known.
b. At least remotely possible and the amount of the loss is known.
c. At least reasonably possible and the amount of the loss is reasonably estimable.
d. Probable and the amount of the loss can be reasonably estimated.
Business
1 answer:
Grace [21]3 years ago
5 0

Answer: Option D

Explanation: In simple words, contingent liability refers to those liabilities the arise of which depends on some event that may or may not happen in the future. Potential lawsuits and warranties on products sold are some of the many examples of contingent liabilities.

These liabilities are recorded so that the firm can make suitable reserves and funds in advance to  tackle thee liabilities but they are only recorded when the amount of loss can be reasonably estimated and it is probable that liability will arise.

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Answer:

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must be presented.

2. Before production​ begins, the​ manufacturer's purchasing department issues purchase orders

to its supplier for needed direct materials.

3. A(n) receiving report

is typically a duplicate of the purchase order but without the quantity​ pre-listed on the form.

4. The bill of materials

is like a list of ingredients in a​ recipe, stating the materials needed to produce a product.

5. A(n) job cost record

is used to accumulate all of the costs affiliated with each job.

6. All direct laborers in the factory fill out​ a(n)

labor time record.

7. The accounting department will not pay​ a(n)

invoice unless it agrees with the quantity of parts both ordered and received.

8. Each item in the raw materials storeroom has its own raw materials record.

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