Which of the following liabilities is NOT contingent?
A) A liability to replace a specific defective television set already returned to the manufacturer
B) A liability to pay pension benefits if a specific employee lives to retirement
C) A liability to pay any adverse judgment for a product liability case currently on appeal
D) A liability to pay for books received by a college bookstore under terms that allow for the return for full refund of any books not sold

Question

Quizplus · Accepted Answer

A liability to replace a specific defective television set already returned to the manufacturer is not contingent because it is a fully recognized liability that has already occurred and is considered to be fixed. The other options all involve uncertainties that need to be resolved before the actual liability can be determined, and therefore, are considered to be contingent liabilities.

Which of the Following Liabilities Is NOT Contingent