What is a contingent liability? What conditions require that a contingent liability be recognized as a...

What is a contingent liability? What conditions require that a contingent liability be recognized as a liability in the books?

Expert Solution

what is contingent liability

answer :contingent liability is a liability that may or may not occur in the future and it is depending upon the outcome of the specific event. examples of contingent liabilities are potential lawsuits , product warranties

conditions for recording contingent liability be recognized as a liability in the books

1) contingent liability is probable and the future event will occur

2)contingent liability is reasonably estimated

these both conditions are required for recording contingent liability as real liability

ekkarill92 answered 2 years ago

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