Which of the Following Are Generally Recorded as Liabilities on the Balance

question 225

Multiple Choice

Which of the following are generally recorded as liabilities on the balance sheet if the loss can be reasonably estimated?

• A)Remote likelihood liabilities
• B)Possible contingent liabilities
• C)Probable contingent liabilities
• D)Immaterial contingent liabilities

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Definitions:

Stock Appreciation Rights

A type of incentive or compensation mechanism provided to employees that gives the right to receive a bonus equivalent to the increase in the company’s stock price over a set period.

Compensatory

Refers to something intended to recompense or make up for a loss, injury, or inconvenience.

Stock Option Plan

A compensation strategy businesses use to grant employees the option to purchase company stock at a discounted price in the future.

Market Price

Market Price is the current price at which an asset or service can be bought or sold in a given market.