Pitchfork Company is being sued by a competitor in a lawsuit alleging patent infringement. Pitchfork's lawyers state that it is possible Pitchfork will lose the suit and be found liable for a judgment costing anywhere from $1,800,000 to $9,000,000. However, the lawyers state that no one estimate is more likely.

As a result of the above information, Pitchforks should report:

Group of answer choices

a contingent liability in the amount of $5,400,000, representing the average amount within the range of damages, on its Balance Sheet and disclose an additional contingency of up to $3,600,000 in the notes to the Balance Sheet.

a contingent liability in the amount of $1,800,000 on its Balance Sheet and disclose an additional contingency of up to $7,200,000 in the notes to the Balance Sheet.

a contingent liability in the amount of $5,400,000 on its Balance Sheet, but not disclose any additional contingency.

a possible contingency of between $1,800,000 and $9,000,000 only in the notes to the Balance Sheet