During 2019, Reese Co. introduced a new line of machines that carry a three-year warranty against manufacturers defects. Based on industry experience, warranty costs are estimated at 2% of sales in the year of sale, 3% in the year after sale, and 5% in the second year after sale. Sales and actual warranty expenditures for the first three-year period were as follows: (assume the accrual method)

Sales Actual Warranty Expenditures

2019 $ 1,800,000 $ 80,000

2020 2,400,000 115,000

2021 2,600,000 160,000

$6,800,000 $355,000

The amount that Reese should report as a liability at December 31, 2021 is ________.