QS $9-15($Algo$)$ Accounting for contingent liabilities LO C$3$

Huprey Company is the defendant in the following legal claims. For each of the following separate claims, indicate whether Huprey should $($a$)$ record a liability, $($b$)$ disclose in notes, or $(c)$ have no disclosure.

Huprey is being sued for damages of $$2,000,000.$ It is very unlikely $($remote$)$ that Huprey will lose the case.

Huprey is very likely to lose a pending lawsuit. It reasonably estimates that damages paid will be $$1,070,000.$

Huprey faces the possibility of a loss on a pending lawsuit. It is reasonably possible that Huprey could be required to pay damages. However, it cannot estimate amounts owed.