Liabilities That Might Arise from Which of the Following Probably

question 35

Multiple Choice

Liabilities that might arise from which of the following probably would be disclosed only in the notes to the financial statements?

• A)Possible warranty claims
• B)Guarantees of the debt of other companies
• C)Possible bankruptcy of an important customer whose account is current
• D)Estimated income taxes for the current year

---

Definitions:

Preliminary Steps

Initial actions or measures taken as preparation for a more significant process or project.

Doctrine

A principle or set of principles laid down by an authority as incontrovertibly true.

Ultra Vires

An act or decision made by an entity that is beyond the scope of its authority, often considered invalid or illegal.

Ultra Vires

Acts conducted by a corporation that lie beyond the powers conferred to it by its corporate charter or the law.