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QUESTION 5 [20] The following provisions have been included in the financial statements of Toffee Limitedat 30 June 2020: R Provision for repair costs for

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QUESTION 5 [20] The following provisions have been included in the financial statements of Toffee Limitedat 30 June 2020: R Provision for repair costs for sales under warranty 210 000 Provision for expected operating losses to be incurred in a trade fairscheduled for September 2020 53 000 Provision for severance pay to employees in a discontinued Operation 50 000 Required: 5.1. Distinguish between a provision, liability, and a contingent liability. (8) 5.2. State with reasons, in each of the above 3 cases, whether a provision shall be recognised at 30 June 2020. (12)

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