In May 2020, West Company filed suit against brown Inc. seeking P850, 000 damages for patent infringement. A court verdict in November 2020 awarded West P600, 000 in damages, but Brown’s appeal is not expected to be decided before 2020. West’s counsel believes it is probable but not virtually certain that West will be successful against brown for an estimated amount in the range between P300, 000 and P450, 000, with P400, 000 considered the most likely amount. What amount should West record as a contingent asset from lawsuit in the year ended December 31, 2020?

In May 2020, West Company filed suit against brown Inc. seeking P850, 000 damages for patent infringement. A court verdict in November 2020 awarded West P600, 000 in damages, but Brown’s appeal is not expected to be decided before 2020. West’s counsel believes it is probable but not virtually certain that West will be successful against brown for an estimated amount in the range between P300, 000 and P450, 000, with P400, 000 considered the most likely amount. What amount should West record as a contingent asset from lawsuit in the year ended December 31, 2020?

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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