medium · Financial Accounting liabilities-bonds-payable

A company has a 'probable' loss of $1,000,000 and is also being sued in a separate case where a loss is 'reasonably possible' for $500,000.

What is the total liability reported on the balance sheet for these two items?

  1. $1,000,000
  2. $1,500,000
  3. $0
  4. $750,000

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