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Zero Growth Ltd$.$ has completed financial statements for the year ended $31$ December $20$X$6.$ The financial statements have yet to be finalized or issued. The following events and transactions have occurred:

a$.$ The office building housing administrative staff was damaged due to a hurricane on $15$ January $20$X$7.$

b$.$ On $15$ November $20x6,$ a customer sued the company for $$1,000,000$ based on a claim of negligence leading to personal injury; Zero is actively defending the suit and claims it is unfounded. Nothing has yet been recorded in the $20$X$6$ financial statements in relation to this event.

c$.$ On $1$ February $20$X$7,$ The company received a $$49,700$ income tax reassessment for $20x5.$

d$.$ On $20$ December $20$X$6,$ Zero applied for a bank loan to replace an existing line off credit. The loan was granted on $2$ January $20x7.$ This event was not recorded in $20$X$6$ or reported in the draft $20$X$6$ financial statements.

e$.$ The company has reinterpreted a legal agreement entitling it to commission revenue for the sale of a client's products. Zero Growth's interpretation would entitle it to an extra $$60,000$ over and above amounts recognized in $20$X$6.$ The amount has not been recorded in the accounts. The client was billed for this amount in $20x6$ but has disagreed with Zero on the contract interpretation. Both parties have consulted their lawyers; resolution is not expected soon.

f$.$ On $1$ March $20$X$7,$ Zero Growth issued new common shares for cash. The new issue increased the total number of shares outstanding by $15\%.$

Required:

Discuss the appropriate accounting treatment for the contingencies and subsequent events described.

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