Needtul Things is facing a joint lawsuit by customers for knowingly selling them cursed objects. Lawyers have determined the customers are very unlikely to win their case but are able to estimate the amount they would be likely to win. How should the event be treated in Needful Things financial statements? The event thould be recorded as a Lowsuit loss and lawsuit liability in the friancial statements. The event should be stated in the compary's footnotes to the financial statements. The cvent does not need to be recorded or stated in the footnotes to the financial statements. The event should be recoeded as a lawsul loss and trwsuit labsity in the financial statements, as well as stated in the footnotes to the firancial itatements. Jake's Bacon Pancakes is considering the potential legal liabilities of several lawsuits related to overly hot pancakes. Which of the following scenarios would be classified as contingent liabilities on Jake's balance sheet? 1. Lawsuit 1 has an estimated cost of $100,000. Lawyers believe the plaintiff has a reasonable possibility of winning. 2. Lawsuit 2 has an estimated cost of $50,000. Lawyers estimate the plaintiff is likely to win their case. 3. The cost of lawsuit 3 cannot be estimated and the likelihood of the plaintiff winning is remote. Lawsuits 1 and 2 Oniv lewsuit 2 Only iswsult 1 All 3 uwsits Vesemir provides magical mutagens to tum people into Witchers in Kaer Morhen. In some cases, the mutagens he provides fail to provide useful mutations, and so are returned to be remade under warranty. On January 1st, 2020. Vesemir had $300,000 in warranty liability listed on his books. During 2020. Vesemir sold 150,000 mutagens, of which 2.00% would eventually prove defective. On average, it costs $310 to remake each mutagen. If 100 mutagens had warranty claims posted in 2020, what is the ending balance in the warranty liability account on the balance sheet as of 12/31/2020? Asty Hardware Store sells chainsaws, of which a certain number will eventually prove defective. Repairs to chainsaws typically cost Ashy $200 per unit. They estimate that 2% of unit sales will be returned for warranty. If they sold 500 units this year, what is the journal entry for their warranty expense? $2.000 $2,000