On February $5,2023,$ an employee filed a $$3$ million lawsuit against I$-$Steel Co$.,$ for damages suffered when one of I$-$Steel's plants exploded on December $29,2022.$ I$-$Steel uses IFRS. I$-$Steel's legal counsel expects the company will lose the lawsuit and estimates the loss to be between $$1,500,000$ and $$2,000,000$ with no point in the range being more likely than any other. The employee has offered to settle the lawsuit out of court for $$2,700,000$ but I$-$Steel will not agree to the settlement. In its December $31,2022$ balance sheet, how should I$-$Steel account for this event?

a$.$

ignore the action since it was only taken after year end.

b$.$

accrue $$2,700,000$ and note disclose information re the lawsuit including amount of action.

c$.$

accrue $$3,000,000.$

d$.$

accrue $$1,750,000$ and note disclose information re the lawsuit including amount of action.

accrue $$1,500,000$ and note disclose information re the lawsuit including amount of action.