Where are the contingent items disclosed in the financial statements?
A)on the assets side of the balance sheet
B)on the liabilities side of the balance sheet
C)as footnotes to financial statements
D)in the income statement

Question

Quizplus · Accepted Answer

Contingent items, such as potential lawsuits or warranties, are typically disclosed in the footnotes to the financial statements rather than being included on the balance sheet or income statement. This allows for transparency in the financial reporting without overstating or understating the company's actual financial position.

Where Are the Contingent Items Disclosed in the Financial Statements