Which of the Following Would NOT Be Considered a Contingent

question 6

Multiple Choice

Which of the following would NOT be considered a contingent liability?

• A)Pending legal action
• B)Potential fines from the EPA
• C)Mortgage Payable
• D)Cosigning a loan

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Definitions:

Installment Contracts

Agreements where payments are made in a series of increments over time in exchange for goods or services.

Conditional Sales Contract

A contract agreement where the buyer takes possession of an item, but its formal ownership and title remain with the seller until the purchase price is paid in full.

Machinery

Physical devices or machines, often powered, that are used in manufacturing processes or to perform various tasks in industries.

Collateral

Assets pledged by a borrower to secure a loan or credit, which can be seized by the lender if the borrower defaults on the repayment terms.