The Financial Accounting Standards Board (FASB) Defines a Loss Contingency

question 52

True/False

The Financial Accounting Standards Board (FASB) defines a loss contingency as an existing condition or situation involving uncertainty as to possible loss that will ultimately be resolved when one or more future events occur or fail to occur.

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Definitions:

Small Corporations

Refers to corporations with a limited number of shareholders and reduced regulatory requirements.

Board of Directors

A group of individuals elected to represent shareholders and oversee the major decisions and policies of an organization.

Preemptive Right

A shareholder’s right to purchase a proportionate share of every new offering of stock by the corporation.

Shareholder's Right

The entitlements or privileges granted to an individual or entity that owns shares in a corporation, including the right to vote on corporate matters and to receive dividends.