A liability can be recognised in an entity's statement of financial position when: Please select all that apply.
A) There is a present obligation as a result of past events.
B) There is an expectation that the obligation can be avoided.
C) There is a contractual or legal claim against the entity.
D) There is expected to be a transfer of an economic resource.

Question

Quizplus · Accepted Answer

A liability is recognized when there is a present obligation from past events (A), a contractual or legal claim (C), and an expected transfer of an economic resource (D). B is incorrect because liabilities cannot be avoided.

A Liability Can Be Recognised in an Entity's Statement of Financial