1. In August, 2014 a worker was injured in the factory in an accident partially the result of his own negligence. The worker has sued Barkley Co. for $800,000. Counsel believes it is reasonably possible that the outcome of the suit will be unfavorable and that the settlement would cost the company from $250,000 to $500,000. 2. A suit for breach of contract seeking damages of $2,400,000 was filed by an author against Henderson Co. on October 4, 2014. Henderson's legal counsel believes that an unfavorable outcome is probable. A reasonable estimate of the award to the plaintiff is between $800,000 and $1,800,000. No amount within this range is a better estimate of potential damages than any other amount. 3. Kroft is involved in a pending court case. Krofts lawyers believe it is probable that Kroft will be awarded damages of $1,000,000. Instructions Discuss fully the proper accounting treatment, including amount to be accrued, if any, why an amount would or would not be accrued and any required disclosures, for each situation.