During 2019, Analee Company filed suit against another entity seeking damages for patent infringement. On December 31, 2019, the legal counsel believed that it was probable that the entity would be successful against the other entity for an estimated amount of P1,500,000. On April 15, 2020, the entity was awarded P1,000,000 and received full payment thereof. The 2019 financial statements were issued on March 31, 2020. How should this award be reported in the 2019 financial statements? O As disclosure of contingent asset P1,000,000 O As disclosure of contingent asset P1,500,000 O As receivable and revenue P1,000,000 As receivable and deferred revenue P1,000,000

During 2019, Analee Company filed suit against another entity seeking damages for patent infringement. On December 31, 2019, the legal counsel believed that it was probable that the entity would be successful against the other entity for an estimated amount of P1,500,000. On April 15, 2020, the entity was awarded P1,000,000 and received full payment thereof. The 2019 financial statements were issued on March 31, 2020. How should this award be reported in the 2019 financial statements? O As disclosure of contingent asset P1,000,000 O As disclosure of contingent asset P1,500,000 O As receivable and revenue P1,000,000 As receivable and deferred revenue P1,000,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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