Bandera Bred recently sued by customer who found a bug in her soup. Banders lawyers believe it is probable that Bandera will be found liable (guilty) and the amount of the damages is estimated to be $450,000. In response to the litigation, Bandera Bread should:

A. Accrue (record) a liability and expense in the current period for $450,000

B. Wait to accrue (record) a liability and expense until after the trial and a guilty verdict has been declared.

C. expense any cash settlement when the payment is made.

D. Only disclose the incident in the notes to the financial statements.