Question
On February 5, 2021, an employee filed a P2,000,000 lawsuit against AB Company for damages suffered when a plant of the entity exploded on December
On February 5, 2021, an employee filed a P2,000,000 lawsuit against AB Company for damages suffered when a plant of the entity exploded on December 29, 2020.
The entitys legal counsel believed the entity will probably lose the lawsuit and estimated the loss to be P500,000.
The employee has offered to settle the lawsuit out of court for P900,000 but the entity will not agree to the settlement.
On December 31, 2020, what amount should be reported as accrued liability?
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Cost And Management Accounting
Authors: Colin Drury
9th Edition
1473749050, 978-1473749054
