Which of the following is not a factor that is considered when evaluating whether or not to record a liability for pending litigation?
A) Time period in which the underlying cause of action occurred.
B) The type of litigation involved.
C) The probability of an unfavorable outcome.
D) The ability to make a reasonable estimate of the amount of the loss.

Question

Quizplus · Accepted Answer

The type of litigation involved is not a factor considered when evaluating whether or not to record a liability for pending litigation. The other factors listed - time period, probability of an unfavorable outcome, and ability to make a reasonable estimate of the loss - are all important considerations when determining whether or not to record a liability for pending litigation.

Which of the Following Is Not a Factor That Is