In April an explosion occurred at Howe Cos plant, causing
damage to area properties. By July several claims had been
asserted against Howe. Howe's legal counsel concluded that it was
probable that Howe would be held responsible for the damages and
that $ would be a reasonable estimate of the damages. The
claims are expected to be resolved by March In Howe's
December financial statements, how should this casualty
be reported?
Accrued a loss of $ on the income statement and accrued a
liability of $ on the balance sheet.
No note disclosure of accrual will be fequired for because the claims
will not be resolved until
Accrued a loss of $ on the income statement only without any
effects on the balance sheet.
As a note disclosing a probable liability of $
