Contingent liabilities are generally not known and are contingent on an event happening. Over the last...

  

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Contingent liabilities are generally not known and are contingent on an event happening. Over the last decade, arguments have been made on whether contingent liabilities should be recorded, disclosed, or remote. A good example is British Petroleum (BP). BP had a huge oil spill and many liabilities arose from this event. BP had to disclose this event in its annual report in 2010 because at the time, it could not estimate an amount. However, in 2011, many of these disclosed contingent liabilities were recorded because past transactions were estimable. Whether it is a known, estimated, or contingent liability, companies incur these liabilities in the course of their operations. It's inevitable. This is why it's important to understand the different types of current liabilities and how they are classified. Whether it is a known, estimated, or contingent liability, companies incur these liabilities in the course of their operations. It's inevitable. This is why it's important to understand the different types of current liabilities and how they are classified. Imagine that you own or work for a business as you discuss the following information in your initial post: • Identify and describe the type of business or organization you will be discussing. • Discuss two examples of current liabilities that your business or organization might have. Please be specific. • List one example of an estimated liability and one example of a contingent liability that your business or organization has or might have. Explain why it is estimated or contingent. • How will these liabilities affect the financial statements? Contingent liabilities are generally not known and are contingent on an event happening. Over the last decade, arguments have been made on whether contingent liabilities should be recorded, disclosed, or remote. A good example is British Petroleum (BP). BP had a huge oil spill and many liabilities arose from this event. BP had to disclose this event in its annual report in 2010 because at the time, it could not estimate an amount. However, in 2011, many of these disclosed contingent liabilities were recorded because past transactions were estimable. Whether it is a known, estimated, or contingent liability, companies incur these liabilities in the course of their operations. It's inevitable. This is why it's important to understand the different types of current liabilities and how they are classified. Whether it is a known, estimated, or contingent liability, companies incur these liabilities in the course of their operations. It's inevitable. This is why it's important to understand the different types of current liabilities and how they are classified. Imagine that you own or work for a business as you discuss the following information in your initial post: • Identify and describe the type of business or organization you will be discussing. • Discuss two examples of current liabilities that your business or organization might have. Please be specific. • List one example of an estimated liability and one example of a contingent liability that your business or organization has or might have. Explain why it is estimated or contingent. • How will these liabilities affect the financial statements?