A contingent liability should be recorded on a company's financial statements only if the likelihood of a loss occurring is:

Question

Quizplus · Accepted Answer

A contingent liability is recorded on financial statements when the loss is probable and the amount can be reasonably estimated. This aligns with accounting principles that require recognition of liabilities when they are likely to occur and can be quantified with a reasonable degree of accuracy.

A Contingent Liability Should Be Recorded on a Company's Financial