How would one journalize the entry

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Point 1: During the year, Metlock was sued by a competitor for a patent violation. The competitor is claiming that Metlock's liability is $2,000,000. Metlock's attorneys have advised it that it is probable that the court will find for the company's competitor. The attorneys estimate that the liability under the suit could be as little as $80,000 or as much as $400,000. The attorneys do not believe any amount within this range is a better estimate of Metlock's liability than any other amount within the range.

Question 1: How would one journalize this entry? know you journalize it because the attorney states we may lose. but the difference of 80000 and 400000. do you average this number out to 240000?

Reference no: EM132484164

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