Problem $8-8$B $($Algo$)$ Record contingencies $($LO$8-5)$

Computer Academic Press faces three potential contingency situations, described below. Computer's fiscal year ends December $31,2024.$

$$

In August $2024,$ a worker was injured in an accident, partially as a result of his own negligence. The worker has sued the company for $$0\mathrm{.}98$ million. Legal counsel believes it is reasonably possible that the outcome of the suit will be unfavorable, and that the settlement would cost the company from $$245,000$ to $$490,000.$

A suit for breach of contract seeking damages of $$1,900,000$ was filed by a consultant on October $4,2024.$ Legal counsel believes an unfavorable outcome is probable. A reasonable estimate of the award to the plaintiff is between $$0\mathrm{.}950$ million and $$1\mathrm{.}425$ million. No amount within this range is a better estimate of potential damages than any other amount.

Computer is the plaintiff in a pending court case. Its lawyers believe it is probable that Computer will be awarded damages of $$1\mathrm{.}9$ million.