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    Question

    Which of the following is not considered as a Current Liability?

    A Interest outstanding on Debentures Correct Answer Incorrect Answer
    B Contingent Liability Correct Answer Incorrect Answer
    C Bills Payable Correct Answer Incorrect Answer
    D Trade Creditors Correct Answer Incorrect Answer

    Solution

    Contingent liabilities are potential obligations that may arise depending on the outcome of future events. They are not actual liabilities until a certain event occurs, and their recognition depends on the probability of the event happening. Contingent liabilities are disclosed in the financial statements but are not recognized as current liabilities.

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