Which of the Following Would Be Defined as Contingent Liabilities

question 55

Multiple Choice

Which of the following would be defined as contingent liabilities?
I. A bank overdraft
II. A loan from a financial institution
III. An agreement to act as guarantor for another firm's borrowings
IV. An unresolved lawsuit brought against the entity for breach of health and safety regulations

• A) I and IV
• B) II, III
• C) III and IV
• D) I and III

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Definitions:

Consent

Agreement or permission given by a person with full understanding of the facts and implications of an action or decision.

Battery

A criminal offense involving the unlawful physical acting upon a threat, distinct from assault which is the act of creating apprehension of such contact.

Compensatory Damages

Financial restitution awarded to a plaintiff to compensate for loss, injury, or harm suffered due to the defendant's actions.

Loss of Wages

Compensation claimed by individuals for income not earned due to injury or wrongful termination.