E$13\mathrm{.}29($LO $7,9)($Contingencies and Commitments$)$ Four independent situations follow.Situation $1$: During $2020,$ Sugarpost Inc. became involved in a tax dispute with the Canada Revenue Agency. Sugarpost's tax lawyers have told management that Sugarpost will likely lose this dispute. They also believe that Sugarpost will have to pay the Receiver General for Canada between $$900,000$ and $$1\mathrm{.}4$ million. After the $2020$ financial statements were issued, the case was settled with the Canada Revenue Agency for $$1\mathrm{.}2$ million.InstructionsWhat amount, if any, should be reported as a liability for this contingency as at December $31,2020,$ assuming that Sugarpost follows ASPE?Situation $2$: Toward the end of Su Li Corp.$\text{'}$s $2020$ fiscal year, employer$-$union talks broke off, with the wage rates for the upcoming two years still unresolved. Just before the new year, however, a contract was signed that gave employees a $5\%$ increase in their hourly wage effective January $1,2021.$ Su Li had spent $$1\mathrm{.}2$ million in wages on this group of workers in $2020.$InstructionsPrepare the entry, if any, that Su Li Corp. should make at December $31,2020.$ Briefly explain your answer.Situation $3$:On October $1,2020,$ the provincial environment ministry identified JackhammerChemical Inc. as a potentially responsible party in a chemical spill. Jackhammer's management, along with its legal counsel, have concluded that it is likely that Jackhammer will be found responsible for damages, and a reasonable estimate of these damages is $$5$ million. Jackhammer's insurance policy of $$9$ million has a clause requiring a deductible of $$500,000.$Instructionsa. suming SPE falmed a should Jackhammer Chemical repor this information in is finan.b$.$ Briefly identify any differences if Jackhammer followed IFRS.Situation $4$: Etheridge Inc. had a manufacturing plant in a foreign country that was destroyed in a civil war. It is not certain who will compensate Etheridge for this destruction, but Etheridge hasamount.