Which of the following is true of a contingent liability?
A)It is a potential liability that depends on a future event.
B)It is an actual liability that is difficult to estimate.
C)It is an actual liability that depends on a past event.
D)It is a liability resulting from a lawsuit settled in court.

Question

Quizplus · Accepted Answer

A contingent liability is a potential liability that depends on a future event, such as a lawsuit that has not yet been settled or a warranty that may or may not be claimed by a customer in the future.

Which of the Following Is True of a Contingent Liability