A Mechanic's Lien Is Possessory

question 38

True/False

A mechanic's lien is possessory.

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Definitions:

Remote Contingent Liability

A potential financial obligation that is considered to be unlikely to occur; it is noted in financial statements as a footnote to provide full disclosure.

Accrual

A method of accounting that recognizes revenue and expenses when they are incurred, regardless of when cash transactions occur.

Disclosure

Disclosure involves the act of making new or important information known, especially about the financial or operational state of a company.

Current Assets

Assets that are expected to be converted into cash, sold or consumed within one year or within the normal operating cycle of the business, whichever is longer.