'A potential future obligation to an outside party for an unknown amount resulting from activities that have already taken place contingent on a future event' is the definition of:
A) a long- term liability.
B) contingent liability
C) an accrued liability.
D) a current liability.

Question

Quizplus · Accepted Answer

The definition given matches a contingent liability, which is a potential future obligation that depends on the occurrence or non-occurrence of a future event. Examples include lawsuits, product warranties, or environmental liabilities. A long-term liability is a known obligation that is payable over a period of more than one year, while an accrued liability is a known but unpaid expense that has been incurred but not yet paid. A current liability is a debt that must be paid within one year or a normal operating cycle of a company.

'A Potential Future Obligation to an Outside Party for an Unknown