In: Accounting
Eastern Manufacturing is involved with several situations that
possibly involve contingencies. Each is described below. Eastern’s
fiscal year ends December 31, and the 2021 financial statements are
issued on March 15, 2022.
Required:
1. Determine the appropriate way to report each
situation.
2. Prepare the appropriate
journal entries for these situations.
Eastern Manufacturing can deal with the situations in the following ways -:
Loss- Litigation A/c Dr. |
$148,000,000 |
|
Liability- Litigation a/c |
$148,000,000.00 |