A Certain Contingent Liability Was Evaluated at Year-End, and Considered

question 67

True/False

A certain contingent liability was evaluated at year-end, and considered to have a reasonable possibility of becoming an actual liability. If the accountant decided not to report it on the balance sheet or in the notes to the financial statements, this could be considered a violation of generally accepted accounting principles.

---

Definitions:

Intellectual Functioning

A term referring to the cognitive capabilities of an individual, including reasoning, problem-solving, planning, abstract thinking, comprehension, and learning.

Extrafamilial

Pertaining to influences, relationships, or activities that occur outside of the family environment.

Resilient

The ability of an individual to recover quickly from difficulties or adapt to challenging situations with flexibility.

Historical Factors

Elements or circumstances from the past that influence present conditions or situations.