Multiple Choice $2$ pointsIn February $2023,$ an explosion occurred at a Dinkol Company plant, causing damage to area properties. By April $15,2023,$ no claims had yet been asserted against Dinkol. However, Dinkol's management and legal counsel have concluded that it is possible but not probable that Dinkol might be held responsible for negligence.Furthermore, they have determined that a reasonable estimate for damages might be as much as $$5,000,000.$ Dinkol's comprehensive public liability policy contains a $$900,000$ deductible clause. For Dinkol's December $31,2022$ financial statements, for which the auditor's fieldwork was completed in April $2023,$ how should this possible casualty loss be reported, if at all?as an accrued liability of $$900,000$as a note disclosing a contingent loss of $$900,000$as a note disclosing a contingent loss of $$5,000,000$No disclosure or accrual is required.