A restaurant is being sued because a customer claims to have found a bug in her chili. The company's lawyers believe there is only a remote possibility that the lawsuit will result in an actual liability.

A restaurant is being sued because a customer claims to have found a bug in her chili. The company's lawyers believe there is only a remote possibility that the lawsuit will result in an actual liability. Which of the following actions should be taken by the company's management?A. The situation should be described in a note to the financial statements.

B. The possible liability should be ignored
C. The liability should be estimated and recorded as an expense.
D. Management should consider resigning

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