Tick and Tie, CPAs, were performing their annual audit of Johnson Manufacturing Company. Johnson is currently being sued for $2,000,000 related to an alleged defective product sold to a customer. Johnson's lawyer told Tick and Tie that it is likely that Johnson will lose the suit and have to pay the entire $2,000,000. The management of Johnson has included information about the lawsuit in the footnotes. However, they have not recorded any loss in the income statement or liability in the balance sheet. Write an opening and second paragraph based on the situation