Which of the following would be considered a contingent liability?

please help me answer this question.

Which of the following would be considered a contingent liability?

A. Sales tax obligation

B. Accounts payable obligation

C. Pending legal action

D. Mortgage obligation

1 Answer

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  • Sandy
    Lv 7
    8 years ago
    Favorite Answer

    Which of the following would be considered a contingent liability?

    C. Pending legal action

    Contingent liability:

    - a possible obligation depending on whether some uncertain future event occurs, or

    - a present obligation but payment is not probable or the amount cannot be measured reliably

    There is nothing uncertain about the other 3, which are actual liabilities.

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