Danbury Corporation was involved in a lawsuit with the EPA alleging inadequate air pollution control facilities at its Lafayette plant site during 2011.At December 31,2014,it appeared probable that the EPA would settle for approximately $150,000.This event should be recognized in 2014 as a(n)

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The $150,000 settlement would be recognized as a loss on the lawsuit, which is an operating expense. It is not considered an extraordinary loss because it is related to the company's normal business operations. It should also not be disclosed only in a note, as it is material enough to require recognition in the financial statements.

Danbury Corporation Was Involved in a Lawsuit with the EPA