At the beginning of 2018, Sun Angel Corporation began offering a two-year warranty on its products. The warranty program was expected to cost Sun Angel 1% of net sales in the first 12 months and 3% of net sales in the second 12-month period. Net sales made under warranty in 2018 were $180 million. Fifteen percent of the units sold were returned in 2018 and repaired or replaced at a cost of $5.3 million. The amount reported on Sun Angel's 2018 year end balance sheet for Est. Warranty Liability is:

A $5.3 million

B $7.2 million

C $1.9 million

D $19.8 million