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For each item indicate the correct choice for accounting for contingent liabilities. Based on current...

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Accounting

For each item indicate the correct choice for accounting for contingent liabilities. Based on current year sales of $5,000,000 the company expects warranty expenses of 5% of these sales A. Disclose/Footnotes The company has been sued by the government for environmental damages. The company believes it is probable they B. Record in Financial Statements will lose the lawsuit, but is unable to make a reasonable estimate of the loss. C. No disclosure is required A customer falls in one of our store locations. Security cameras and eyewitnesses clearly indicate that the fall was faked. The company is being sued for false advertising. The company believes the loss is probable and an estimate of the loss can be made. The company includes $1.00 off discount coupons in the boxes of cereal that they manufacture. The company expects 25% of the coupons issued will be redeemed by customers

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