Faramarzinikpey Company, a public company, is preparing its annual financial statements on December 31, 2022. The following selected information is available: 1. The company has been sued by an employee for discrimination. The employee is seeking $5,000,000 in damages. Legal counsel believes it is unlikely that the company will have to pay any damages. The amount is material (substantial) to the company. 2. Employees have accrued (earned) $4,200 in vacation pay benefits as of December 31,2022 . 3. The company has been sued in a $3,000,000 product liability lawsuit. Legal counsel believes the company will probably have to pay the full amount. 4. On October 1,2022 , the company signed a $10,000,6-month, 8% note payable. No interest has been accrued to date. Instructions: Prepare any necessary adjusting entries or disclosures on December 31, 2022