Multiple choice general knowledge

Contingent Liability appears in balance sheet?

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Contingent liabilities are not recognized on the balance sheet because they are uncertain obligations that may or may not occur. They are only disclosed in the notes to the financial statements when there is a possible obligation that cannot be reliably measured, or a present obligation where payment is not probable. Only certain liabilities are recognized on the balance sheet.

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