Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On October 15th, a Dunn Corp, truck was in an accident with an auto driven by C. Jameson. November 30th Dunn received notice of a lawsuit for $200,000 in damages for
personal injuries suffered by Jameson. Dunn Corp.'s legal counsel believes it is probable that C. Jameson will be awarded an estimated amount in the range between $75,000 and
$150,000, and that $125,000 is a better estimate of potential liability than any other amount. What is the liability Dunn should record if any on December 31, Dunn's fiscal
year-end?
$200,000
$112.500
$150,000
$125,000
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