During year 2, Smith Co.filed suit against West, Inc. seeking damages for patent infringement. At December 31, year 2, Smith's legal counsel believed that it was probable that Smith would be successful against West for an estimated amount in the range of $75,000 to $150.000, with all amounts in the range considered equally likely. In March year 3, Smith was awarded $100,000 and received full payment thereof. In its year 2 financial statements, issued in February year 3, how should this award be reported? O As a disclosure of a contingent gain of an undetermined amount in the range of $75,000 to $150,000. O As a receivable and deferred revenue of $100,000. O As a disclosure of a contingent gain of $100,000. O As a receivable and revenue of $100,000,

During year 2, Smith Co.filed suit against West, Inc. seeking damages for patent infringement. At December 31, year 2, Smith's legal counsel believed that it was probable that Smith would be successful against West for an estimated amount in the range of $75,000 to $150.000, with all amounts in the range considered equally likely. In March year 3, Smith was awarded $100,000 and received full payment thereof. In its year 2 financial statements, issued in February year 3, how should this award be reported? O As a disclosure of a contingent gain of an undetermined amount in the range of $75,000 to $150,000. O As a receivable and deferred revenue of $100,000. O As a disclosure of a contingent gain of $100,000. O As a receivable and revenue of $100,000,

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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