How should a liability that has an unlikely chance of occurring and is insignificant in size be disclosed?
A)No Yes
B)No No
C)Yes No
D)Yes Yes

Question

Quizplus · Accepted Answer

According to the accounting principle of materiality, a liability that has an unlikely chance of occurring and is insignificant in size can be considered immaterial and need not be disclosed in the financial statements. Therefore, the company can choose not to disclose it, and it will not affect the overall fairness or transparency of the financial information.

How Should a Liability That Has an Unlikely Chance of Occurring