4. Which of the following is true of a contingent liability?OIt is a potential liability that depends on a future event.OIt is an actual liability that is difficult to estimate.OIt is an actual liability that depends on a past event.OIt is a court-imposed liability based on an officer's fraud as decided in a completed lawsuit.

Solution: A contingent liability is a potential liability that may result in outflow of resources in…

4. Which of the following is truè õf a Olt is a potential liability that depends on a future event. Olt is an actual liability that is difficult to estimate. Olt is an actual liability that depends on a past event. nourt imnored liahility based on an officer's fraud as decided in a completed lawsuit.

4. Which of the following is truè õf a Olt is a potential liability that depends on a future event. Olt is an actual liability that is difficult to estimate. Olt is an actual liability that depends on a past event. nourt imnored liahility based on an officer's fraud as decided in a completed lawsuit.

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter4: Professional Legal Liability

Section: Chapter Questions

Problem 7CYBK

See similar textbooks

Similar questions

A lawsuit is an example of a contingent liability for the defendant. O True False
The following are grounds for liability to pay damages, except: a. Negligence b. Fraud c. Contravention of the tenor of the obligation d. Advance
Which of the following is NOT a contingent liability? a. Pending law suit for property damage b. Product warranty c. Discounted note receivable d. Pending law suit for slander
11) An estimated liability: A) Is an unknown liability of a certain amount. B) Is a known obligation of an uncertain amount that can be reasonably estimated. C) Is a liability that may occur if a future event occurs. D) Can be the result of a lawsuit. E) Is not recorded until the amount is known for certain. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Which of the following statements is incorrect? O a. If the occurrence of the obligation is in doubt, there is no need to account for the liability. O b. A liability is a present obligation, arising from past transaction, which probably has to be paid. O c. Damages awarded by court against the business may be ignored because it will be appealed. O d. A liability has to be accounted for at the best reliable estimate even if the amount is not certain.
which of the following is true? a.When what is to be delivered is a generic thing, the creditor may ask a person other than the debtor to perform the obligation. b.Dolo incidente relates to the fraud committed at the time of the perfection of a contract. c.When negligence is imputed as a cause for the breach in an obligation, the same is presumed.
Which of the following statements is false?Select one:a. A contingent liability should be disclosed in the notes to the financial statements if there is a reasonable possibility that a loss (or expense) will occur.b. A contingent liability should be accrued if the loss is probable and the amount of the loss can be reasonably estimated.c. A contingent liability is a potential obligation that depends on the future outcome of past events.d. All contingent liabilities should be reported as liabilities on the financial statements, even those that are unlikely to occur.
Individuals who believe they relied on misstated financial statements to make a decision andhave suffered losses as a result will issue an action known as aa. Breach of contract.b. Tort.c. Securities litigation.d. Constructive fraud.
may an action arising from negligence be waived? explain
What is an example of rationalization as one of the three elements causing a person to commit fraud?
Generally, the auditor could be legally liable under? Select one: a. contract law but not under the tort of negligence to third parties b. the tort of negligence to the client and contract law c. the tort of negligence but not contract law to the client d. contract law to third parties and to the client
6. Which of the following statements is true?a. No loss contingencies should be disclosed if there is just a reasonable possibility of a loss.b. Indirect guarantees should normally be accrued.c. Losses may be accrued for unasserted claims and other potential unfiled lawsuits.d. In the case of loss contingencies, accrual can be made even if the exact payee and payment date are not