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Following is the unadjusted trial balance for Sun Energy Co. on December 31, 2017 Sun Energy Co. Unadjusted Trial Balance Year Ended December 31, 2017

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Following is the unadjusted trial balance for Sun Energy Co. on December 31, 2017 Sun Energy Co. Unadjusted Trial Balance Year Ended December 31, 2017 Account Debit Credit Cash $6,000 Accounts Receivable 2,900 Merchandise Inventory 4,500 Buildings 2,400 Equipment 4,200 Accounts Payable $5,200 Salaries Payable 3,500 Common Stock 2,500 Dividends Sales Revenue 16,100 COGS 3,800 Salaries Expense 3,500 Totals $27,300 $27,300 You are also given the following supplemental information: A pending lawsuit, claiming $2,500 in damages, is considered likely to favor the plaintiff and can be reasonably estimated. Sun Energy Co. believes a customer may win a lawsuit for 53,500 in damages, but the outcome is only reasonably possible to occur. Sun Energy calculated warranty expense estimates of $210. A. Using the unadjusted trial balance and supplemental information for Sun Energy Co, construct an income statement for the year ended December 31, 2017 RW particular attention to expenses resulting from contingencies Sun Energy Co. Income Statement Year Ended December 31, 2017 Revenues: Total Revenues Expenses: Total Expenses B. Construct a balance sheet, for December 31, 2017, from the given unadjusted trial balance, supplemental information, and income statement for Sun Energy Co, paying particular attention to contingent liabilities Sun Energy Co. Balance Sheet December 31, 2017 Assets Total Assets Liabilities Qll) du 000 Total Liabilities Stockholders' Equity Total Liabilities and Stockholders' Equity C. Sun Energy Co. is the defendant in a pending lawsuit, The plaintiff is claiming $2,500 in damages and is considered likely to win this amount when the core is tried to addition, Sun Energy Co, belleves another customer may win a different lawsuit for $3,500 in damages, but this outcome is only possible, not kely, to occur. Also, fun Energy Co, has calculated a warranty expense estimate of $210. How much should be included as labilities and expenses with respect to these items on ABC's current financial statements

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