Which of the Following Would NOT Be Shown as a Contingent

question 9

Multiple Choice

Which of the following would NOT be shown as a contingent liability?

• A) estimated future cost of providing superannuation for work already carried out by employees
• B) a dispute with the taxation department where legal advice suggests that the company will win the dispute
• C) a company providing a guarantee to a lender for a loan taken out by a subsidiary company where a default on the loan is very unlikely
• D) company defending a claim for unspecified damages where the amount of the claim cannot be reliably measured.

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Definitions:

Product Changes

Modifications or improvements made to a product’s design, specifications, or features to enhance its performance, appeal, or compliance with regulations.

JIT Partnerships

Collaborations between suppliers and manufacturers that follow Just-In-Time inventory principles to reduce waste and increase efficiency.

Competitive Bidding

A procurement process where suppliers submit their bids to win a contract, based on price and/or other criteria.

Vertical Integration

Developing the ability to produce goods or services previously purchased or actually buying a supplier or a distributor.