Ask Question
BusinessBusiness
2 May, 06:42

Which of the following best exemplifies a contingency that is reported in the notes to the financial statements?

a. Loss from a lawsuit settled out of court prior to the end of the fiscal year.

b. Warranty claims on future sales.

c. Estimated loss from an ongoing lawsuit.

d. Losses from potential future lawsuits.

+1
Answers (1)
  1. 2 May, 06:44
    0
    The correct answer is letter "C": Estimated loss from an ongoing lawsuit.

    Explanation:

    A contingent liability is an amount that will need to be charged in the future but there are still outstanding problems that only make it a possibility. Litigation and the threat of litigation are the most common contingent liabilities, but this category also includes product warranties. If they are probable and the sum can be calculated, contingent liabilities must be reported on the company's Balance Sheet.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Which of the following best exemplifies a contingency that is reported in the notes to the financial statements? a. Loss from a lawsuit ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
Ingram Industries is considering two alternative new machines. Machine 1 would bring in revenues of $70,000, have variable costs of $42,000, and fixed costs of $14,000.
Answers (1)
The two main components of globalization are: a. the standardization of technology and the globalization of markets b. the globalization of markets and the globalization of production c.
Answers (1)
Which part or phrase in the passage suggests a reason due to which Jack may not be employed in the field of private security? Jack wants to work as a security guard.
Answers (1)
If a bond's stated interest rate is lower than the market rate, which of the following is true? A) The bond will be issued at par. B) The bond will be issued at a premium. C) The bond will be issued at a discount.
Answers (1)
All but one of the following is a reason for outsourcing services. Select one: a. Avoids coordination expenses and delays b. Allows the firm to focus on its core competence. c. Provides access to latest technology. d.
Answers (2)
New Questions in Business
Examples of transaction costs include (check all that apply) : A. the cost of the externality. B. the cost of monitoring an agreement. C. the cost of drafting a contract or agreement. D.
Answers (1)
Josh, Inc. is faced with the choice of either producing a newly designed product, XX-30, to stock in anticipation of demand or to customer order. The demand for the product is expected to be 5,000 units per week.
Answers (1)
Gwen is a psychologist who maintains an office in a professional suite. She often spends time doing paperwork and scheduling in her home officeWhich of the following is true?
Answers (1)
A certificate of deposit will often result in a penalty for withdrawing funds before the maturity date. If the penalty involves two months of interest, what would be the amount for early withdrawal on a $20,000, 4 percent CD?
Answers (1)
Androscoggin Copper can grow at 5% per year for the indefinite future. It's selling at $100, and next year's dividend is $5.
Answers (1)
Home » Business » Which of the following best exemplifies a contingency that is reported in the notes to the financial statements? a. Loss from a lawsuit settled out of court prior to the end of the fiscal year. b. Warranty claims on future sales. c.
Sign Up Forgot Password?