- Contingent liabilities (like lawsuits) are only recorded if they are probable and estimable. As a result, most companies do not record contingent liabilities for lawsuit. Could this be misleading for users of the financial statements? Why do you think both are required before a contingent liability can be recorded? - If a company has $500,000 in current assets and current liabilities of $250,000, calculate the Current Ratio. Why is a higher number better? What does that ratio tell you about the company