Questions from Financial Accounting

Q: If $10 million of Dell Inc.’s $130 million

If $10 million of Dell Inc.’s $130 million notes payable is due in the next year, how will the firm present this debt within the current and long-term liabilities sections of the current year’s balanc...

Q: Define contingent liability. Provide three common examples.

Define contingent liability. Provide three common examples.

Q: List and briefly describe the three categories of likelihood that a payment

List and briefly describe the three categories of likelihood that a payment for a contingent liability will need to be made.

Q: Under what circumstances should a firm report a contingent liability?

Under what circumstances should a firm report a contingent liability?

Q: Suppose the firm’s analysis of a contingent liability indicates that an obligation

Suppose the firm’s analysis of a contingent liability indicates that an obligation is not probable. What accounting treatment, if any, is warranted?

Q: If a contingent liability is probable but estimable only within a range

If a contingent liability is probable but estimable only within a range, what amount, if any, should the firm report?