Apex Sporting Company is a defendant in a lawsuit that claims damages of \(\$ 55,000\). On the balance sheet date, it appears likely that the court will render a judgment against Apex. How should Apex report this event in its financial statements? (pp. 456-457)

a. Omit mention because no judgment has been rendered

b. Disclose the contingent liability in a note

c. Use a short presentation only

d. Report the loss on the income statement and the liability on the balance sheet