Which of the Following Statements Regarding Contingencies Is True

question 136

Multiple Choice

Which of the following statements regarding contingencies is true?

• A)Contingencies that are probable and estimable must be recorded before the outcome of future events.
• B)Contingent assets,if probable and estimable,are treated in much the same way as contingent liabilities.
• C)The accounting principle that determines whether a contingent asset is recorded is that of materiality.
• D)Contingencies that are not estimable should not be disclosed even if probable.

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Definitions:

Goods And Services

Physical items (goods) and intangible assistance (services) that fulfill the needs or wants of consumers.

Broad Segmentation Bases

General criteria used to categorize and define groups within a market, such as age, gender, income levels, or location.

Measurable

Capable of being measured or quantified, allowing for the assessment of performance against specific benchmarks or criteria.

Differentiable

The ability of a product or service to be distinguished from others due to unique features or characteristics.