Question 3 (1 point) Listen A supplier sued Pneumatic Systems Inc. for $200,000 for breach of contract. Pneumatic's legal counsel believes that they will almost certainly be found liable. Based on previous results, the lawyer estimates that there is a 60% probability that the supplier will be awarded the $200,000; a 30% probability that the judgment will be $150,000; and a 10% probability that $100,000 will be conferred. Assuming that Pneumatic reports its financial results in accordance with IFRS, indicate which of the following will be the appropriate accounting treatment: A) Recognize an asset of $175,000. B) Recognize a liability of $200,000. C) Disclose the details of the contingency in the notes to the financial statements. D) Recognize a liability of $175,000.