Young Company is involved in a lawsuit. The liability that could arise as a result of this lawsuit should be recorded on the books if the probability of Young owing money as a result of the lawsuit is:
A) Remote and the amount is reasonably estimable.
B) Probable and the amount is reasonably estimable.
C) Reasonably possible and the amount is reasonably estimable.
D) Probable and the amount is not reasonably estimable.
Answer: B
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