Which statement about contingent assets is correct?
A)It involves only potential economic outflows of resources.
B)It is a possible asset that depends upon the outcome of a future event.
C)It involves uncertainty about either the timing or amount of payment.
D)It is a condition that depends upon the outcome of a forecasted event.

Question

Quizplus · Accepted Answer

A contingent asset is a possible asset that arises from past events and whose existence is confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity. The recognition of a contingent asset depends on the probability of the future event occurring and the degree of reliability of the measurement of the asset.

Which Statement About Contingent Assets Is Correct