Gray Co Estimates It Is Probable That It Will Receive a a $10,000

question 88

Multiple Choice

Gray Co. estimates it is probable that it will receive a $10,000 gain contingency and pay a $4,000 loss contingency. After recording the appropriate journal entries to recognize contingent amounts, Gray Co.'s net assets will:

• A) Increase by $10,000.
• B) Increase by $6,000.
• C) Decrease by $4,000.
• D) Not change.