GAAP gain and loss contingencies

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• Loss/Gain contingencies

  Generally accepted accounting principles (GAAP) require loss contingencies to be accrued in the period the contingency becomes known. However, GAAP specifically disallows booking gain contingencies until the gain is realized.

• Description about liabilities and GAAP

  Generally accepted accounting principles (GAAP) require loss contingencies to be accrued in the period the contingency becomes known. However, GAAP specifically disallows booking gain contingencies until the gain is realized.

• US GAAP codification. What is it? Who does it affect?

  ASC 450-20 is the subtopic on Loss Contingencies under the general topic ASC 450 on Contingencies.[ 7] There may be circumstances, for example when gain contingencies are being addressed, when reference to ASC 450 would be appropriate.

• Current liabilities and contingencies - Journal Entries

  The amount is known as of the balance sheet issue date and is therefore both probable and estimable. (e) Gain contingencies are never recorded - only loss probabilities. No entry.

• Contingencies and Financial Statements

  There are two basic types of contingencies - a contingent loss or a contingent gain. In cases of contingent loss again there are three further classifications - High, Reasonable and Remote.

• Current Liabilities and Contingencies

  The main issue is that we have to follow the letter of the law, and that includes the FASB provisions for loss contingencies.

• conditions to be met before a contingency can be accrued?

  There are gain and loss contingencies but gain contingencies are generally not reported in income. You just wait until the contingency is resolved and you know the exact outcome.

• Intermediate Accounting: Liabilities, Financial Statements, GAAP

  This solution of 236 words prepares adjusted entries for each scenario as well as touches on liabilities and contingencies in GAAP.

• Discuss contingencies and how they are reported on financial

  -- Accounting for loss contingencies is governed by SFAS No. 5. Loss contingencies are classified according to likelihood as remote, reasonably possible, and probable.