Determining Transaction Price and Refund Liability

In January, a retailer sells $300$ paper shredders to customers for $$100$ each. The terms of the sales include a right for the customer to return a shredder within $180$ days of the sale date. Based on historical trends, the retailer uses the expected value method and estimates a $35\%$ probability that $24$ paper shredders will be returned, a $40\%$ probability that $27$ paper shredders will be returned, and a $25\%$ probability that $36$ paper shredders will be returned. The retailer also concludes it is highly probable that there will not be a significant reversal of revenue recognized based on this return estimate. Thus, the agreement is a valid contract. Assume no actual returns in January.

Determine $(1)$ the transaction price for the sale of shredders for January, and $(2)$ the refund liability balance on January $31.$ Round expected returns to the nearest whole unit in your calculations.

Transaction price $

Refund liability $