Gain contingencies should
A) be accrued if they are probable and can be reasonably estimated.
B) not be accrued in the accounts.
C) be accrued only if they are the result of litigation or government appropriation.
D) never be accrued or disclosed in the footnotes.

Question

Quizplus · Accepted Answer

Gain contingencies should not be accrued in the accounts. This is because recognizing potential gains before they are realized can mislead users of financial statements by overstating the entity's financial position.

Gain Contingencies Should