Under ASPE, the Following Should NOT Be Disclosed in Notes

question 81

Multiple Choice

Under ASPE, the following should NOT be disclosed in notes to the financial statements.

• A) If the contingency is unlikely and the chance of occurrence is small.
• B) If the contingency is likely but the amount of the loss cannot be reasonably estimated.
• C) If the existence of the contingent liability is not determinable.
• D) If the contingency is unlikely but it could have a substantial negative effect on the company's financial position.

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Definitions:

Accrued Interest

Interest that has been earned but not yet received or recorded as of a specific date, often related to bonds or loans.

Investment in Bonds

Purchasing debt securities issued by corporations or governments to earn interest income and potentially benefit from bond price appreciations.

Available-for-Sale Securities

Financial assets that are neither classified as held-for-trading nor held-to-maturity, and whose value is subject to change; gains and losses are typically reported in other comprehensive income.

Fair Market Value

The price at which an asset would change hands between a willing buyer and a willing seller, both having reasonable knowledge of all relevant facts and neither being under compulsion to buy or sell.