A Contingent Liability Should Be Disclosed in the Notes to the Financial

question 85

True/False

A contingent liability should be disclosed in the notes to the financial statements if there is a reasonable possibility that a loss (or expense)will occur.

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Definitions:

Offeror

The party in a contract negotiation who presents the offer to enter into an agreement.

Offeree

The person to whom an offer is made in a contract situation.

Capacity

The legal ability of an individual or organization to enter into a contract, including being of the required age and sound mind.

Exemption Clauses

Provisions in a contract that limit or exclude one party's liability for certain breaches or damages.