Potential liabilities that depend on future events arising out of past events are called:
A) long-term liabilities
B) contingent liabilities
C) actual liabilities
D) estimated liabilities

Question

Quizplus · Accepted Answer

Contingent liabilities are potential liabilities that depend on future events arising out of past events. They are not actual liabilities yet, but they may become actual liabilities in the future depending on what happens. Examples include lawsuits, warranties, and environmental remediation costs.

Potential Liabilities That Depend on Future Events Arising Out of Past