A contingent liability is recorded in the accounting records when it is probable that a loss has been incurred and the amount of the loss is known.

Question

Quizplus · Accepted Answer

A contingent liability is recorded in the accounting records when it is probable that a loss has been incurred, but the amount of the loss is not known or can only be estimated. Therefore, it is not recorded until the amount can be reasonably estimated.

A Contingent Liability Is Recorded in the Accounting Records When