Which of the Following Contingencies Should Be Accrued in the Accounts

question 23

Multiple Choice

Which of the following contingencies should be accrued in the accounts and reported in the financial statements?

• A) The company is forcefully contesting a personal injury lawsuit and a loss is possible and reasonable estimable.
• B) An accommodation endorsement involving a remote loss
• C) It is probable that a company will receive $50,000 in settlement of a lawsuit.
• D) The estimated expenses of a one-year product warranty.

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