Which of the Following Is the Proper Treatment for a Liability

question 32

Multiple Choice

Which of the following is the proper treatment for a liability that exists,but the exact amount of which is not known?

• A) The liability should be treated as a contingent liability.
• B) The amount of the liability should be estimated and recorded.
• C) The liability should be ignored.
• D) The liability should be reported in the notes to the financial statements.

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Definitions:

Adult Daycare

A service providing supervised care and social opportunities for elderly or disabled adults during the day.

Mental Changes

Alterations in cognitive function, mood, or behavior, which can be due to a variety of factors including illness, injury, or psychological conditions.

Confused

A state of being bewildered or unclear in one’s mind about something; often a symptom of various medical or mental conditions.

Caregivers

Individuals who provide care to people needing assistance due to illnesses, disabilities, or aging, often family members or professional healthcare workers.