Under ASPE, a Contingent Liability Must Be Accrued in the Financial

question 51

Multiple Choice

Under ASPE, a contingent liability must be accrued in the financial statements if

• A) it can be reasonably estimated and unlikely to occur.
• B) it can be reasonably estimated and likely to occur.
• C) it is likely to occur but cannot be reasonably estimated.
• D) the amount of the potential loss is greater than the balance in the cash account.

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Definitions:

Sale Price

The final price at which an item or service is sold, often after discounts or negotiations.

Scratches

Marks or superficial damage on a surface caused by scraping or abrasion, often affecting the appearance or function of an item.

Sales Prices

The set amount at which goods or services are sold to customers, influencing the business's revenue.

Salespeople

Individuals who are employed to sell products or services to customers.