Friday, 8 May 2020

state the likelihood of a future event and state how the contingency will be reported

Analyze the following independent situations. 
Required:  For each situation, state the likelihood of a future event and state how the contingency will be reported.
a.  Company A estimates it will have to pay $85,000 in warranty repairs next year.
b.  Company B is being sued by a customer.  Company B's attorneys feel that this is a frivolous lawsuit and there is very little chance that the customer will win.
c.  Company C co-signed a note payable for Company D.  Company D is having serious financial problems and it is reasonably possible that Company C will have to pay the note.
d.  Company E is being sued for a patent infringement.  Company E's attorney feels that Company E will be found liable for damages caused by the patent infringement.  However, the attorney states it is not possible to estimate the amount of the award.

No comments:

Post a Comment

Note: only a member of this blog may post a comment.