Help help help!! Thank you so much!

I am writing to request your assistance with a client problem. I understand that you are now familiar with the Accounting Codification. I hope that you will able to use your knowledge of the codification as well as the proper accounting treatment for subsequent events and contingencies to help me respond to this client problem. Please work on this assignment on your own - do not consult with your classmates. Today, one of our clients, Gunnar Messup (the CEO of Platter Perfection), sent me the following e-mail: Good morning, Nancy - I hope you've been enjoying this wonderful fall. Things have been a bit stormy for us. As you may have heard, in October 2016, we had a major shipping problem for our ceramic platter line. One of our new shipping crew members packed the platters in actual peanuts rather than packing peanuts. Several stores received the boxes of platters in peanuts and reported that receiving dock employees and customers experienced peanut allergy symptoms and had to receive medical treatment. Three customers sued us in November for a total of $300,000. Keep in mind that our year December 31, 2016. We hope to issue our 2016 financials by April 1^st. Our attorneys think we will probably lose the suit to the first two customers and will have to pay $100,000 in March 2017 and $100,000 in June 2017. We are preparing our 2016 financial statements. We booked the following entry as of 12/31/16 and plan to post it to 2016 records: I am only recording the March payment to the first customer since we won't have to pay the other customer until after the financials are issued in April. I hope your intern can determine if my proposed entry is in accordance with GAAP. Please include a reference to the GAAP rules for accounting for contingencies like this. If you are recommending some other approach or entry, please let me know. Thanks. Oh wait - I just got a call from our attorneys today. It looks like we will probably lose the suit involving the third customer - that's an additional $75,000 over the two $100,000 amounts discussed above. Please prepare a memo that recaps the problem, explains how Gunnar should account for the platter problem under GAAP and proposes any required journal entry. Address your memo directly to Mr. Messup since I plan to forward it to him on Wednesday, March 1st for your help