Analyze the following independent situations. Determine how each contingency should be treated. a. Weaver, Inc. is being sued by a former employee. Weaver believes that there is a remote chance that the employee will win. The employee is suing Weaver for damages of $40,000. Describe the situation in a note to the financial statements. b. Gulf Oil Refinery had a gas explosion on one of its oil rigs. Gulf believes it is likely that it will have to pay environmental clean-up costs and damages in the future due to the gas explosion. Gulf cannot estimate the amount of the damages. Record an expense and a liability based on estimated amounts. c. Lawson Enterprises estimates that it will have to pay $75,000 in warranty repairs next year.

Which of the following is likely not a benefit of requiring a grand jury to listen to and examine all of the evidence against a person suspected of committing a serious crime and then independently deciding whether or not to hand down an indictment? 1.the grand jury system provides the accused another safeguard against being sent to trial and facing conviction based on flawed evidence. 2.the members of the grand jury are drawn from the community and are empowered to render independent decisions about whether or not the government has collected enough evidence to bring an individual to trial. 3.the grand jury’s decision can provide prosecutors insight into what is necessary to build a sufficient case if a similar crime is presented later. 4.the grand jury is impaneled to rubber-stamp prosecutors’ cases, which makes it possible for more cases to reach trial.