When Accounting for a Business Combination a Contingent Liability Is

question 5

Multiple Choice

When accounting for a business combination a contingent liability is recognised if:

• A) it is a present obligation that has failed to meet the recognition criteria
• B) its fair value can be measured reliably
• C) it is a possible obligation and it is probable that it will occur
• D) it is probable that an outflow of resources may occur in order to settle the obligation

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Definitions:

Breakdown Torque

The maximum torque a motor can produce when operating at full load, before the motor stalls or overheats.

Locked-rotor

Locked-rotor refers to a condition where the rotor of an electric motor cannot turn despite electrical current being applied, often due to mechanical obstruction or overload.

Locked-rotor

A condition where the motor's rotor is unable to move or rotate, typically due to excessive load or mechanical obstruction.

NEMA Design B

A specification by the National Electrical Manufacturers Association for standard efficiency induction motors with normal torque and low starting current.