Answer:
Journal Entry
Explanation:
The Journal Entry is shown below:-
1. No Journal Entry is required
2. No Journal Entry is required
3. Â Loss Dr, Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â $400,000
     To Contingent Liability          $400,000
(Being Contingent Liability is recorded)
Therefore for recording the third entry we debited the loss and credited the contingent liability.