Kohlbeck Company recently was sued by a competitor for patent infringement. Attorneys have determined that it is
Question:
Kohlbeck Company recently was sued by a competitor for patent infringement. Attorneys have determined that it is probable that Kohlbeck will lose the case and that a reasonable estimate of damages to be paid by Kohlbeck is $200,000. In light of this case, Kohlbeck is considering establishing a $100,000 self-insurance allowance. What entry(ies), if any, should Kohlbeck record to recognize this loss contingency?
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