An Obligation That Is Contingent on the Occurrence of a Future

question 25

Multiple Choice

An obligation that is contingent on the occurrence of a future event should be reported in the balance sheet as a liability if the

• A) future event is likely to occur.
• B) amount of the obligation can be reasonably estimated.
• C) occurrence of the future event is at least reasonably possible and the amount is known.
• D) occurrence of the future event is probable and the amount can be reasonably estimated.

---

Definitions:

Employment Law

A branch of law that deals with the rights and obligations of working individuals, including issues related to hiring, dismissal, work conditions, and discrimination.

Collective Bargaining

The process through which unions negotiate with employers on behalf of their members to establish employment contracts, covering wages, hours, benefits, and working conditions.

NLRA

The National Labor Relations Act, a foundational law in the United States that protects employees' rights to organize and engage in collective bargaining.

Injunction

A legal order issued by a court that compels a party to do or refrain from doing specific acts.