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Contingent liabilities are potential obligations that may arise depending on the outcome of a future event. Three examples include: 1) a lawsuit where the company may have to pay damages if it loses the case; 2) guarantees made by a company on loans taken by another party, where the company may need to pay if the borrower defaults; and 3) product warranties, where a company may be liable for repairs or replacements if products fail within a warranty period.

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