INTERVIEW QUESTIONS ACCOUNTING PROCESS CONTINGENT ASSETS AND CONTINGENT LIABILITIES DETAILS

Question: Bill discounted with a bank is __________ a) Contingent liability b) Current liability c) Current Asset d) None of these

Answer: (a) Contingent liability
Description: Bill discounted with a bank is a contingent liability because it has still not been honoured and hold the risk of dishonor on due date. It is shown as a footnote to the balance sheet for disclosure.

(a) Contingent liability
Description: Bill discounted with a bank is a contingent liability because it has still not been honoured and hold the risk of dishonor on due date. It is shown as a footnote to the balance sheet for disclosure. Source: CoolInterview.com

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