Onopea Inc.considered two contingencies at the end of 2016: ** a probable loss in the range of $300,000 to $500,000
** a reasonably possible loss of $150,000
Under IFRS,what is the balance for contingent liabilities at the end of 2016?
A)$300,000
B)$400,000
C)$450,000
D)$550,000

Question

Quizplus · Accepted Answer

Under IFRS, when a loss is probable and can be estimated within a range, the midpoint of the range is recognized. Therefore, the midpoint of $300,000 to $500,000 is $400,000. The reasonably possible loss is not recognized as a liability.