Reference no: EM132861159

Question -

a. Jennings is involved in a pending court case. Kowalski's lawyers believe it is probable that Kowalski will be awarded damages of $14,000,000. What is the accounting treatment for the situation?

b. In February, 2020 a worker was injured in the factory in an accident partially the result of his own negligence. The worker has sued Frontier Co. for $1,100,000. Counsel believes it is reasonably possible that the outcome of the suit will be unfavorable and that the settlement would cost the company from $350,000 to $700,000. What is the accounting treatment for the situation?

c. A suit for breach of contract seeking damages of $2,400,000 was filed by Okurrrr against Cardi Co. on January 4, 2020. Okurrrr's legal counsel believes that an unfavorable outcome is probable. A reasonable estimate of the award to the plaintiff is between $900,000 and $1,300,000. No amount within this range is a better estimate of potential damages than any other amount. What is the accounting treatment for the situation?

d. On January 1, 2020, Ospina Co. issued 20-year bonds with a face value of $4,200,000 and a stated interest rate of 6%, payable semiannually on June 30 and December 31. The bonds were sold to yield 4%.

What is the Calculations for the issue price of the bonds?

What is the amortization table for 2020 only, assuming that amortization is recorded on interest payment dates.