I have questions on current liabilities and COntinigencies

Solutions

Expert Solution

Current Liabilities refers to present obligations that the business or person needs to be paid to its creditors or suppliers. These liabilities appear on the balance sheet and these are definite in nature.

Eg. You purchased some goods worth $1000 on credit for the further sale and thereafter the payment for the goods that is pending will be treated as Current Liabilities.

Contingencies refer to a future event or such circumstance that might create a liability in future will be called as a contingent liability.

For Example, your business is legally sued by your customer to pay damages to him/her for supplying a damaged/defective product.

In this case, you do not know whether there is an obligation to pay for the damages or not as the decision would be in the hands of the court.

This will be recorded if the losses are probable and the damages are identified or else it will be ignored and will be written in the notes to the accounts.

ekkarill92 answered 1 year ago

Next > < Previous

Related Solutions

What criteria distinguish current liabilities from non-current liabilities? Give an example.

If current assets is $200,000, and current liabilities is $50,000 . what will be the current...

If current assets is $200,000, and current liabilities is $50,000 . what will be the current ratio.?

Define current liabilities. List the current liabilities we cover in this chapter. What are payroll deductions?...

Define current liabilities. List the current liabilities we cover in this chapter. What are payroll deductions? Provide some examples. How is net pay calculated? Employer payroll taxes include FICA Tax and Federal & State Unemployment Tax. Which expense account is debited for employer payroll taxes? Provide an example journal entry. Employee payroll taxes include FICA Tax & Income Tax. Which expense account is debited for employee payroll taxes? Provide an example journal entry. What is the formula to calculate interest...

On the subject of Social Determinants of Health, I have a few questions I have to...

On the subject of Social Determinants of Health, I have a few questions I have to answer like describe overall impression of how we are doing in terms of social determinants? What surprised you the most? Where do you see us doing a good job? What social determinants factors negatively the health of individuals? From a ethical standpoint how can we do bter as a country? As a state? As a community? As a individual?

I would like clarification on the movement of current. I have heard that current travels "path...

I would like clarification on the movement of current. I have heard that current travels "path of least resistance", but I have never fully grasped the concept. I understand that current travels from higher potential to lower potential so does that mean that the higher the potential, the greater the resistance and therefore current travels path of least resistance?

Q1. Should a firm have as much as possible OCL(operating current liabilities) and as little as...

Q1. Should a firm have as much as possible OCL(operating current liabilities) and as little as possible OCA(operating current assets)? Briefly explain.

For operating activities does current liabilities have a direct or inverse relationship with cash? What is...

For operating activities does current liabilities have a direct or inverse relationship with cash? What is included in the investing section of the Statement of Cashflow? What is included in the financing section of the Statement of Cashflow?

On December 31, Nate Inc. reported the following (in millions): Current Assets Current Liabilities Long-term Liabilities...

On December 31, Nate Inc. reported the following (in millions): Current Assets Current Liabilities Long-term Liabilities Equity $4,863 $4,544 $5,939 $1,305 What amount did the company report as total assets? Select one: a. $6,925 million b. None of the these are correct. c. $16,651 million d. $10,483 million e. $14,041 million

I have to answer these questions in a way that I can write out in a...

I have to answer these questions in a way that I can write out in a word document. Previous answer make little sense. I need to interpret (A) and I am just not understanding what the y intercept of -23 is indicating. I understand question b, not 100% on C please see below: A criminologist is interested in the effects of unemployment and policing on murder and has run the following multiple regression: Summary Output Regression Statistics Multiple R 0.90303...

I have questions on how to do this in R/Rstudio or smoothing methods. I have been...

I have questions on how to do this in R/Rstudio or smoothing methods. I have been struggling with using the codes. I have been practicing and tryign to do it, but I am really unsure at where I am with it. Just need something to compare it too! I don't understand why there isn't any information under the demand section! (1) A memo written to the Chief Operations Officer of Transantiago that describes the model and method and presents the...

Subjects