What Is a Contingency

question 152

Multiple Choice

What is a contingency?

• A) An existing situation where certainty exists as to a gain or loss that will be resolved when one or more future events occur or fail to occur.
• B) An existing situation where uncertainty exists as to possible loss that will be resolved when one or more future events occur.
• C) An existing situation where uncertainty exists as to possible gain or loss that will not be resolved in the foreseeable future.
• D) An existing situation where uncertainty exists as to possible gain or loss that will be resolved when one or more future events occur or fail to occur.

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Definitions:

First-In-First-Out (FIFO)

An inventory valuation method where the oldest inventory items are used up or sold first.

Work in Process

This term refers to the materials, labor, and overhead costs for products that are in the production process but are not yet complete.

Job Cost Sheet

A form prepared for a job that records the materials, labor, and manufacturing overhead costs charged to that job.

Production Reports

Production reports are documents that provide information on the status, output, and efficiency of the production process within a manufacturing operation.