3. A recent issued demographic report indicates that there is a reasonable probability that ABC company's business may be adversely impacted in the future. The company's controller wants to begin accruing a general contingency reserve now for unspecified business contingencies, such as the potential decline in business that may occur in the future. Find FASB ASC as to whether or not such accrual is allowed under GAAP. (The citation must follow xxx-xx-xx-xx or xxx-xx-xx-x format

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Asked May 11, 2019
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3. A recent issued demographic report indicates that there is a reasonable probability that ABC company's business may be adversely impacted in the future. The company's controller wants to begin accruing a general contingency reserve now for unspecified business contingencies, such as the potential decline in business that may occur in the future. Find FASB ASC as to whether or not such accrual is allowed under GAAP. (The citation must follow xxx-xx-xx-xx or xxx-xx-xx-x format

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Under FASB ASC Section 450-20-25-2 contingency liability needs to be recorded as an expense if it is probable any asset is impaired or liability is incurred due to occurence or non-occurence of uncertain future event and the amount of l...

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