Calculator a. It is probable that the EPA fine will stand. b. An out-of-court settlement for $650,000 has recently been reached with the employee, with the final papers to be signed next week. c. Counsel believes that the homeowner's case is weak and will be decided in favor of Maximilien Company. d. Other litigation related to the spill is possible, but the damage amounts are uncertain. Required: a. Based on this information, prepare the journal entries for the contingent liabilities associated with the spill. Use the account "Damage Awards and Fines" to recognize the expense for the period. If an amount box does not require an entry, leave it blank. Damage Awards and Fines 2,400,000 EPA Fines Payable 1,750,000 Litigation Claims Payable 650,000 b. Prepare any note disclosure related to the spill, TMT ktbo The company experienced a radioactive materials spill at one of its plants during the previous period. This spill has resulted in a number of lawsuits to which the company is a party. The Environmental Protection Agency (EPA) has fined the company $ 3 which the company is contesting in court. Although the company admit fault, legal counsel believes that the fine payment is In addition, an employee has sued the company. A S o ut-of-court settlement has been reached with the employee. The EPA fine and out-of-court settlement have been recognized as for the period. There is one other outstanding lawsuit related to this incident. Counsel believe that the lawsuit has merit. Other lawsuits and unknown liabilities may arise from this incident