About this document
Accounting Treatment of Legal Expenses by Patrick Hariramani is a document available to read on EtoBox.
1. The lawsuit cannot be recorded as an expense because the outcome is uncertain. It should be disclosed in a note to the financial statements. 2. A $50,000 loss from a lawsuit should be recorded as an expense with a liability, not deducted from retained earnings. 3. Only expenses that can be reasonably estimated should be recognized currently. The additional $16,000 should reduce expenses and increase income and retained earnings.
- Author
- Patrick Hariramani
- Language
- EN