Which of the following does not meet the definition of a liability? a. The signing of a 3-year employment contract at a fixed annual salary b. An obligation to provide goods or services in the future c. A note payable with no specified maturity date d. An obligation that is estimated in amount

Which of the following does not meet the definition of a liability? a. The signing of a 3-year employment contract at a fixed annual salary b. An obligation to provide goods or services in the future c. A note payable with no specified maturity date d. An obligation that is estimated in amount

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter12: Current Liabilities

Section: Chapter Questions

Problem 1MC: Which of the following is not considered a current liability? A. Accounts Payable B. Unearned...

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Concept explainers

Contingent Liabilities and Provisions

A contingent liability can be defined as a liability the occurrence of which is dependent upon the happening of an uncertain future event. It is generally recorded in the books only when the amount of liability can be reasonably estimated and the contingency is likely to occur shortly.

Question

Which of the following does not meet the definition of a liability?
a. The signing of a 3-year employment contract at a fixed annual salary
b. An obligation to provide goods or services in the future
c. A note payable with no specified maturity date
d. An obligation that is estimated in amount

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Accounting for Current liabilities, Provisions and Contingencies

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