Describe how each of the following events would be treated on the balance sheet [i.e., recorded in a journal entry, disclosed in footnotes to the balance sheet, or ignored].

1. The company is sued by a competitor for infringement on its patent. The court has yet to render an opinion. Your attorney believes your company will lose, and have to pay perhaps $45,000.

2. The company is sued by a former employee for $55,000 for age discrimination. The case, also, is still in court but your attorney believes the case is without merit and your company will win.