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.

Question

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The Answer of 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.

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