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    Contingent Liability - Determine the probability of an event

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    A contingent liability should be created if it probable that the liability will occur and the amount of the loss can be reasonably estimated.

    How is the probability of an event occurring determined? Is this based on an estimate of the likelihood of the event occurring?

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    Contingent Liability
    How is the probability of an event occurring determined? Is this based on an estimate of the likelihood of the event occurring?

    Past activities or circumstances may give rise to possible future

    Contingent Liability
    How is the probability of an event occurring determined? Is this based on an estimate of the likelihood of the event occurring?

    A contingency is defined in FASB Statement No. 5 as, ...

    Solution Summary

    Determining the probability of an event determining.

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