A Contingent Liability Is a Liability That May Occur If

question 134

True/False

A contingent liability is a liability that may occur if some future event takes place.

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Definitions:

Direct Materials

Raw materials that can be directly traced to the production process of a product and are considered a part of the finished product.

Direct Labor

The cost of wages paid to workers directly involved in the production of goods or services.

Job Order Cost Sheets

Documents that record and track the costs associated with a specific job or order.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including the cost of the materials and labor directly used in creating the good.