Problem 3: REQUIRED: Determine the appropriate way to report each situation, and prepare any necessary journal entry and disclosure note for Bliss Corporation. Explain your reasoning. Assume December 31, 2022 year-end and assume March 15, 2023 is the date the financial statements are issued. 3-1 In December 2022, the State of Wisconsin filed suit against Bliss Corporation seeking penalties for violation of OSHA rules. Based upon discussions with legal counsel, Bliss feels it is probable that $50 million will be required to cover the cost of the violation. Bliss believes that the ultimate settlement with OSHA will not materially impact the company. 3-2 Bliss Corporation is the plaintiff in a \$20 million lawsuit filed against a customer for damages due to lost profits from uncompleted contracts and unpaid receivables. The case is in final appeal and legal counsel advises that it is probable that Bliss Corporation will prevail and be awarded $10 million. 3-3 On March 1, 2023, Bliss Corporation knows a competitor has threatened litigation due to patent infringement. The competitor has not yet filed a lawsuit. Bliss management believes a lawsuit is reasonably possible, and if a lawsuit is filed, management believes damages up to $4 million are reasonably possible