All of the Following Statements Regarding Uncertainty in Liabilities Are

question 115

Multiple Choice

All of the following statements regarding uncertainty in liabilities are true except:

• A) Liabilities can involve uncertainty in whom to pay.
• B) A company can create a known amount when issuing a note even though the holder of the note may not be known until the maturity date.
• C) A company can have an obligation of a known amount to a known creditor but not know when it must be paid.
• D) A company only records liabilities when it knows whom to pay, when to pay, and how much to pay.
• E) A company can be aware of an obligation but not know how much will be required to settle it.