Schweigert Paint Company, which prepares annual financial statements, is preparing adjusting entries on December 31. Analysis indicates the following: (1.) The company is the defendant in an employee discrimination lawsuit involving $50,000 of damages. Legal counsel believes it is unlikely that the company will have to pay any damages. (2.) December 31st is a Friday. The employees of the company have been paid on Monday, December 27th for the previous week which ended on Friday, December 24th. The company employs 30 people who earn $100 per day and 15 people who earn $160 per day. All employees work 5-day weeks. (3.) The company is a defendant in a $500,000 product liability lawsuit. Legal counsel believes the company probably will have to pay the amount requested.