A company has a contingent loss that can be estimated and has a probable chance of occurrence. What reporting does the FASB require regarding this contingency?
A) It should be accrued and reported on the financial statements and reported in the notes to the financial statements.
B) It should be reported in the notes to the financial statements.
C) It should be ignored until the actual loss materializes.
D) It should be accrued and reported on the financial statements.

Question

A company has a contingent loss that can be estimated and has a probable chance of occurrence. What reporting does the FASB require regarding this contingency? 
A) It should be accrued and reported on the financial statements and reported in the notes to the financial statements.
B) It should be reported in the notes to the financial statements.
C) It should be ignored until the actual loss materializes.
D) It should be accrued and reported on the financial statements.

Quizplus · Accepted Answer

The Answer of A company has a contingent loss that can be estimated and has a probable chance of occurrence. What reporting does the FASB require regarding this contingency? 
A) It should be accrued and reported on the financial statements and reported in the notes to the financial statements.
B) It should be reported in the notes to the financial statements.
C) It should be ignored until the actual loss materializes.
D) It should be accrued and reported on the financial statements.

A Company Has a Contingent Loss That Can Be Estimated