Please provide solution upon answering!
"Module 4- Exercises on Provisions and Contingencies pdf X C @ File | C:/Users/Lenovo/Downloads/Module%204-9%20Exercises%20on%%20Provisions%20and%%20Contingencies.pdf Not syncing 4 of 19 Q + 0 Page view A Read aloud V Draw ~ Highlight Erase P EXERCISE 2 Determine the amount that will be recognized as a liability in each of the following independent cases. CASE I In August 2020, the XYZ commenced a suit against DEF for alleged violation of anti-trust laws seeking damages of P 2,000,000. DEF denies the allegations, and as of December 31, 2020, it is not likely that DEF will pay any damages as a result of this lawsuit. CASE 2 In September 2020, the Garrison Company became involved in lawsuit. As a result of this litigation, it is more likely than not that Garrison will have to pay an amount ranging from P 700,000 to P 1,000,000 but P 800,000 is considered to be the best estimate of the obligation. CASE 3 In the latter part of December 2020, Dallas Company's vehicle was involved in a collision with a truck of Kansas Corporation. In January 2021, Kansas filed a suit against Dallas for damages to the vehicle. Based on the police's incident report, it is probable that estimated damages between P 300,000 and P 500,000 will be incurred by Dallas. Each point within that range of amounts is considered as likely as any other point. Dallas issued its 2020 financial statements in March 2021. Type here to search 9 P 27"C Rain showers ~ "0 E (0) 7:30 PM 9/19/2021"Module 4- Exercises on Provisions and Contingencies pdf X @ File | C:/Users/Lenovo/Downloads/Module%204-9%20Exercises%20on*%20Provisions%%20and%20Contingencies.pdf Not syncing 5 of 19 Q + 0 0| Pageview A Read aloud \\ Draw ~ Highlight Erase CASE 4 In the latter part of December 2020, Dallas Company's vehicle was involved in a collision with a truck of Kansas Corporation. In January 2021, Kansas filed a suit against Dallas for damages to the vehicle. Based on the police's incident report, it is probable that estimated damages between P 300,000 and P 500,000 will be incurred by Dallas. In February 2021, Kansas accepted Dallas offer of P 350,000 for reimbursement of damages on its car. Dallas issued its 2020 financial statements in March 2021. CASE 5 During 2020, the Going Steady Company sold appliances that offer product warranties against defects. Based on the entity's and industry experience, it is estimated that 60% of the products sold have no defects, 30% have minor defects and 10% have major defects. Estimated warranty costs were P 1,000,000 if all products sold have major defects and P 200,000 if all products sold have minor defects. Going Steady has already incurred P 60,000 of warranty costs relating to appliances sold during 2020. CASE 6 In October 2020, Manila City Government bought action against Harrison Company in the amount of P 1,900,000 for polluting Manila Bay. It is less than probable but more than remote that Manila City government will be successful, but the amount of damages Harrison will have to pay is not reasonably determinable at December 31, 2020. Type here to search 9 YO W 27"C Rain showers ^ ^ "0 E (0) 7:30 PM 9/19/2021"Module 4- Exercises on Provisions and Contingencies pdf X C @ File | C:/Users/Lenovo/Downloads/Module%204-9%20Exercises%20on%%20Provisions%20and%%20Contingencies.pdf Not syncing 7 of 19 Q + 0 Pageview A Read aloud V Draw ~ Highlight Erase EXERCISE 4 Arthur Corporation pays bonuses to its sales manager and two sales agents. The company had profit for 2020 of P 3,000,000 before bonuses and income taxes. Assume- a.) The sales manager gets 8% and each sales agent gets 6% of profit before tax and bonuses. b.) Each bonus is 12% of profit after income tax and bonuses. c.) Sales manager gets 12% and each sales agent gets 10% of profit after bonuses but before income tax. REQUIRED: Determine the amount of bonus of the sales manager and for each sales agent under the given independent assumptions. Assume a tax rate of 30%. Type here to search X 27"C Rain showers ~ 0 5 () 7:31 PM 9/19/2021
