Question: can you explain in detail why the answer is 3000? 12.10 Montague's paint shop has suffered some bad publicity as a result of a customer

can you explain in detail why the answer is 3000?

12.10 Montague's paint shop has suffered some bad publicity as a result of a customer claiming to be suffering from skin rashes as a result of using a new brand of paint sold by Montague's shop. The customer launched a court action against Montague in November 20X3, claiming damages of $5,000. Montague's lawyer has advised him that the most probable outcome is that he will have to pay the customer $3,000. What amount should Montague include as a provision in his financial statements for the year ended 31 December 20X3

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