Which statement is correct?
A)Contingencies arise from future events.
B)Financial guarantees arise from contracts previously entered into.
C)Current liabilities arise from future events.
D)The amount to be paid for financial guarantees is known or reasonably estimable.

Question

Quizplus · Accepted Answer

Financial guarantees arise from contracts previously entered into, whereas contingencies arise from uncertain future events. Current liabilities can arise from a variety of events, including past transactions and obligations, with the expectation of payment in the near term. The amount to be paid for financial guarantees is typically known or reasonably estimable based on the terms of the contract.

Which Statement Is Correct