Question: Eagle Co. has cosigned the mortgage note on the home of its president, guaranteeing the indebtedness in the event that the president should default. Eagle

Eagle Co. has cosigned the mortgage note on the home of its president, guaranteeing the indebtedness in the event that the president should default. Eagle considers the likelihood of default to be remote. How should the guarantee be treated in Eagle’s financial statements?

a. Disclosed only.

b. Accrued only.

c. Accrued and disclosed.

d. Neither accrued nor disclosed.

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