A Contingent Liability Should Be Disclosed to the Financial Statement

question 58

True/False

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

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Definitions:

Credited

Recorded or acknowledged as having received something, often used in financial contexts to indicate an addition to certain accounts.

Selling Price

The price at which a product or service is sold to customers.

Retained Earnings

The portion of a company's profits that is not distributed as dividends to shareholders but is instead reinvested in the business or kept as a reserve.

Cash Available

The amount of cash that a company or an individual has on hand or can easily access.