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Unformatted text preview: Part 2 Constantine Company is being sued for $4,000,000 for an injury caused to a child as a result of alleged negligence while the child was visiting the Constantine Company plant in March 2010. The suit was filed in July 2010. Constantines lawyer states that it is probable that Constantine will lose the suit and be found liable for a judgment costing anywhere from $400,000 to $2,000,000. However, the lawyer states that the most probable judgment is $1,000,000. Instructions: How should Constantine report the suit in its 2010 financial statements? Discuss the rationale for your answer. Include in your answer disclosures, if any that should be made in Constantines financial statements or notes....
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This note was uploaded on 10/03/2011 for the course ACCOUNTING 103 taught by Professor Ngo during the Spring '11 term at University of California, Berkeley.
- Spring '11