Which of the following liabilities can be classified as either current or long term?
A)known and estimated
B)estimated and contingent
C)known and contingent
D)known, estimated, and contingent

Question

Quizplus · Accepted Answer

Known liabilities are those that are certain or have already occurred, such as accounts payable or wages payable. Estimated liabilities are those that are probable but not certain, such as warranty liabilities or income tax liabilities. Contingent liabilities are potential liabilities that may or may not occur, such as pending lawsuits or product warranties. All three types of liabilities (known, estimated, and contingent) can be classified as either current or long-term, depending on the timing of the payment. Therefore, option D is the best choice.

Which of the Following Liabilities Can Be Classified as Either