Which Statement About Contingent Liabilities Is Correct

question 7

Multiple Choice

Which statement about contingent liabilities is correct?

• A)It is a present obligation that will probably result in the economic outflow of resources.
• B)It involves uncertainty about either the timing of payment or the amount of payment.
• C)It is an obligation that arises from past transactions and events and can be reliably measured.
• D)It is a present obligation that arises from past events but it cannot be reliably measured.

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Definitions:

Lingerie Store

A retail outlet specializing in the sale of women's underwear, sleepwear, and similar intimate apparel.

Posterior Probabilities

The probabilities assigned to statistical outcomes after taking into consideration prior probability distribution and current evidence.

Prior Probabilities

The probabilities of different possible outcomes or hypotheses as assessed before any relevant evidence is taken into account.

Likelihood Probabilities

The probabilities of different outcomes estimated using a statistical model based on observed data.