Edge Co., a toy manufacturer, is in the process of preparing its financial statements for the year ended December 31, 2013. Edge expects to issue its 2013 financial statements on March 1, 2014.

Given in question are various information that has not been reflected in the financial statements. For each item:

1) Determine if an adjustment is required and select the appropriate amount, if any, from the options provided:

a) No adjustment Required b) $150,000 c) $100,000

2) Enter either Yes or No if additional disclosure is required, either on the face of the financial statements or in the notes to the financial statements.

Question 5 - "On November 22, 2013, Edge initiated a lawsuit seeking $250,000 in damages from patent infringement."

"$100,000; Yes"

No adjustment is required; No

"$150,000; Yes"

No adjustment is required; Yes