A Contingent Liability May Materialize in the Future Because of Something

question 66

True/False

A contingent liability may materialize in the future because of something that happened in the past.

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Definitions:

Note Receivable

A financial asset representing a written promise to receive a specific amount of money, plus interest, at a future date.

Negotiable Instrument

A document guaranteeing the payment of a specific amount of money, either on demand or at a set time, with the payer named on the document.

Maturity Value

The total amount that will be paid to an investor at the end of a bond's term or the face value plus any interest.

Note Receivable

A written promise for amounts to be received by a debtor, acknowledging a debt to be paid to the creditor at a future date.