Question: Entity A makes rofunds to customers for any goods returned within 30 days of the sale and has done so for many years. The current

Entity A makes rofunds to customers for any goods returned within 30 days of the sale and has done so for many years. The current year-end is 31 October 2023. REQUIRED: How should Entity A report this event in the financial statements on the reporting date of 31 October 2023 ? CHOICES FOR INPUT: | Provision | Contingent liability | Contingent asset | None of them | ANSWER: A customer is suing Entity A for damages alleged to have been caused by Entity A's product. Entity A is contesting the claim and, an 31 October 2023, the directors have been advised by Entity A's legal advisers it is very unlikely to lose the case. REQUIRED: How should Entity A report this event in the financial statementsjon the reporting date of 31 October 2023 ? CHOICES FOR INPUT: | Provision | Contingent liabllity | Contingent asset | None of them |

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