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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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