Final answer:
As of December 31, 2024, Van Rushing should report as current liabilities the notes payable of $4.2 million. No long-term liabilities should be reported related to the described situations. If the lawsuit is neither known nor probable before the fiscal year-end or the injury event occurred after the fiscal year-end, no liabilities should be reported.
Step-by-step explanation:
In a business financial context, we need to determine the appropriate accounting treatments for specific situations faced by Van Rushing Hunting Goods as of their fiscal year end, December 31, 2024. Here is the analysis based on the given information:
1. Current Liability
At December 31, 2024, Van Rushing Hunting Goods should report the notes payable of $4.2 million as a current liability in the balance sheet since it is due within the next year, specifically on February 8, 2025.
2. Long-term Liability
There should be no long-term liability reported in the balance sheet at December 31, 2024, concerning the situations described.
3. Current and Long-term Liability - Probable Material Loss Evaluation
If the management does not consider a material loss probable and the settlement agreement occurs on March 15, 2025, no liability related to the work-site injury should be reported in the balance sheet at December 31, 2024, since it was not known nor probable before the fiscal year-end.
4. Current and Long-term Liability - Change of Injury Date
If the work-site injury had occurred on January 3, 2025, instead of December 20, 2024, there would be no liability to report related to this event in the balance sheet at December 31, 2024, as this happened after the fiscal year-end.