A contingent liability need only be disclosed in the financial statement notes when the likelihood of the contingency is
A) reasonably possible.
B) probable.
C) remote.
D) unlikely.

Question

Quizplus · Accepted Answer

A contingent liability should be disclosed in the financial statement notes if it is reasonably possible that the contingency will result in a loss. The other options (B, C, D) describe different levels of likelihood but do not necessarily require disclosure unless other factors are present.

A Contingent Liability Need Only Be Disclosed in the Financial