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Former employees of Dreams Unlimited, Inc. filed a lawsuit against the company in 2008 for alleged age discrimination. Based on discussion with its external legal
Former employees of Dreams Unlimited, Inc. filed a lawsuit against the company in 2008 for alleged age discrimination. Based on discussion with its external legal counsel, company management believes the lawsuit probably will conclude in the first quarter of 2011, resulting in a liability between $800,000 and $1,200,000, with all amounts in that range being equally likely.
Required: Determine what amount under IFRS, if any, should be recognized on the December 31, 2010 financial statements related to this lawsuit.
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