. A customer filed a lawsuit against Company A in December 2021 for costs and damages allegedly incurred as a result of the failure of one of Company A's electrical products. The amount claimed was $3million. Company A's Lawyer has advised that the amount claimed is extortionate and that Company A has a good chance of winning the case. However, the lawyers have also advised that if Company A loses the case, expected costs and damages would be about $500000. Required: Discuss how company A should disclose this event in its financial statements as of 31 December 2021?