At December 31, Year 5, Creole Co. was suing a competitor for patent infringement. The award from the probable favorable outcome could be reasonably estimated. Creole's Year 5 financial statements should report the expected award as a: a. Receivable and revenue. b. Receivable and reduction of patent. c. Receivable and deferred revenue. d. Disclosure by footnote only.

d. Disclosure by footnote only

Explanation:

A contingent asset is a possible economic benefit that would result in inflow of cash to the entity.

Creole Co has a contingent asset that arises from the court application that it has filed to sue a competitor for patent infringement. It is more likely than not (Probability > 50%) that inflow of cash will occur in Creole's entity.

the events meet the definition and recognition criteria of a contingent asset set in IAS 10. A contingent asset is only disclosed in the Financial Statements.

1) the stages a new product goes through from beginning to end, i.e., the stages that a product passes through from introduction through growth, maturity, and decline. 2) the time from initial research and development to the time at which sales and support of the product to customers are withdrawn. 3) the period of time during which a product can be produced and marketed profitably.

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