To restate a prior period, Girvois must estimate a liability at the relevant date. The file of the time used two scenarios (method provided by the case): 70 % for 50,000 and 30 % for 10,000. It is now known that the outcome was 0. What amount should be used for the prior period?
- Probability of scenario A
- 70 %
- Amount of scenario A
- 50,000
- Probability of scenario B
- 30 %
- Amount of scenario B
- 10,000
- Outcome known later
- 0