2. Which one of the following rules to record contingent liability is incorrect? A. A contingent liability that cannot be estimated and is probable should be recorded. B. A contingent liability that can be estimated and is probable should be recorded. C. A contingent liability that can be estimated and is only reasonably possible should be disclosed but not recorded. D. All of the above. 3. How much do we need to invest today at 10% interest, compounded annually, if we need $1,331 in three (3) years? A. $1,000 B. $800 C. $600 D. $500 4. What is the present value of $500,000 to be paid in 10 years with an interest rate of 8 percent? A. $221.600 B. $231,600 C. $241,600 D. $251,600 5. What is the present value of 10 equal payments of $15,000 in 10 years with an interest rate of 10%? A. $72,169 B. $82,169 C. $92,169 D. $96,169 (Bonus Question) 6. You have just won the state lottery and have two choices for collecting your winnings. You can collet $50,000 today (option 1) or receive $10,100 per year for the next seven years (option 2). A financial analyst has told you that you can earn 10% on your investments. Which alternative should you select? A. Option 1 B. Option 2 C. Option 1 & 2 are equally good for me