Contingent Labifities Several months apo, Laboratory Direct Company experienced a hazardous materials spill at one of its plants. As a result, the Environmental Protection Agency (EPA) fined the company $1,500,000. The company is contesting the fine. In-addition, an employee is seeking $200,000 damages related to injuries sustained while deaning up the spill. Lastly, a homeowner has sued the company for $150,000. The homeowner lives. 6 miles from the plant but believes that the indident has reduced the home's resale value by $150,000. Laboratory Direct's legal counsel believes that it is probable that the EPA fine witl stand. In addition, counsel indicates that an out-of-court settlement of $90,000 has recently been reached with the employee. The final papers will be signed noxt week. Counsel belleves that the homeowner's case is much weaker and will be decided in favor of Laboratory Direct. Other litigation ralated to the spill is possible, but the damage amounts are uncertain. a. Hiustrate the effects of the contingent liabilities associated with the hazardous materials spill on the accounts and financial statements. If no account or activity is affected, select "No effect" from the dropdown list and leave the corresponding number entry box blank. Enter account decreases and cash outflows as negative amounts