Provisions must be recorded if
A)The future event is probable,and the amount can be reliably estimated.
B)The future event is unlikely.
C)The future event is probable,but the amount cannot be estimated.
D)The future event is unlikely,but the amount can be reliably estimated.
E)All of these answers are correct.

Question

Quizplus · Accepted Answer

Provisions are recorded when a future event is probable, meaning there is a high likelihood of it occurring, and the amount can be reliably estimated. If the event is unlikely or the amount cannot be estimated, a provision would not be recorded. If the event is unlikely but the amount can be reliably estimated, a provision may still not be recorded as the likelihood is low. Therefore, only choice A meets the criteria for recording a provision.

Provisions Must Be Recorded If