What may be the effect of settlement on zolo compensation

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Zolo Company is the disputant in a case archived by Witt in 2015 scrutinizing the authenticity of copyright held by Zolo. On December 31, 2015, Zolo found that Witt would almost certainly be productive against Zolo for a normal proportion of P400,000. Appropriately, a P400,000 adversity was assembled by a charge to pay for the year completed December 31, 2015. On December 31, 2016, Zolo and Witt assented to a reimbursement giving cash portion of P250,000 by Zolo to Witt, and move of Zolo's copyright to Witt.

The passing on proportion of the copyright on Zolo's accounting records was P60,000 on December 31, 2016.

Problem 1: What may be the effect of the settlement on Zolo's compensation before charge in 2016?

a. 150,000 augmentation

b. 60,000 reducing

c. 90,000 augmentation

d. 90,000 reducing

Reference no: EM132928071

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