Define the Term "Contingent Liability" and Discuss the Criteria Used

question 43

Essay

Define the term "contingent liability" and discuss the criteria used to classify these events or conditions. Provide some examples of contingent liabilities.

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Definitions:

Shares Outstanding

The total number of a company's shares currently owned by all its shareholders, including share blocks held by institutional investors and restricted shares owned by the company’s insiders.

Statement Of Comprehensive Income

The statement of comprehensive income is a financial statement that includes all changes in equity during a period except those resulting from investments by and distributions to owners.

Depreciation

The accounting method of allocating the cost of a tangible asset over its useful life, reflecting its loss of value over time.

Taxable Income

The portion of an individual's or a corporation's income used to determine how much tax will be owed to the government in a specific tax period.