7 to 9

The following information relates to Q7 to Q8 WICKLOW Company is being sued by CORK Company for breaking a deal. At the same time WICKLOW Company is suing DUBLIN Company for unauthorized use of a cell phone network. Assume you are the accountant for WICKLOW COMPANY Q 7 With reference to the CORK case: Lawyers estimate that that there is a 98% probability that WICKLOW Company will lose the case and will consequently be liable to pay $10 million as a result of the lawsuit. How should WICKLOW Company account for this? Q 8 With reference to the DUBLIN case: Lawyers estimate that that there is a 40% probability that WICKLOW Company will win the case and will receive $4 million as a result of the lawsuit. How should WICKLOW Company account for this? The following information relates to Q9 SHANGHAI Company has Bonds Payable with a nominal (i.e., face) value of $10,000,000. On 1 January 2021, the carrying amount of the Bonds Payable is a Credit balance of $9,650,000. On 1 January 2021, SHANGHAI Company Repurchased (i.e., Extinguished or paid off) the Bonds Payable at a price of $95 per $100 nominal. Q 9 Show the Journal Entry required to record the Repurchase (i.e., Extinguishment) of the Bonds Payable