missal and the legal counsel determined that it is remote that SBMA will become liable in a reliable estimate of P3,000,000. The third case is about patent infringement and the legal counsel determined that it is probable that SBMA will become liable in the following expected value: P2,000,000 - 50% P5,000,000 - 30% P10,000,000 - 20% Required: Determine the following for the year ended December 31, 2014: __________1. Accrued Provision on December 31, 2014 __________2. Disclosed Contingent Liability on December 31, 2014
On December 31, 2014, SBMA Inc. was a defendant in three litigations provided below:
The first case is about environmental violation and the legal counsel determined that it is
reasonably possible that SBMA will become liable in a the range of P4,000,000 to P6,000,000.
The second case is about illegal dismissal and the legal counsel determined that it is remote
that SBMA will become liable in a reliable estimate of P3,000,000.
The third case is about patent infringement and the legal counsel determined that it is probable
that SBMA will become liable in the following expected value:
P2,000,000 - 50%
P5,000,000 - 30%
P10,000,000 - 20%
Required: Determine the following for the year ended December 31, 2014:
__________1. Accrued Provision on December 31, 2014
__________2. Disclosed
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