In $2004,$ Slimon Corporation began selling a new line of products that carry a two$-$year warranty against defects. Based upon past experience with other products, the estimated warranty costs related to dollar sales are as follows:

First year of warranty $,2\%$

Second year of warranty $5\%$

Sales and actual warranty expenditures for $2004$ and $2005$ are presented below:

Sales

$2004,2005$

$$600,000,$$$800,000$

$20,000,40,000$

$\{\begin{array}{ccc}\text{:}& \text{A}\text{c}\text{t}\text{u}\text{a}\text{l}\text{w}\text{a}\text{r}\text{r}\text{a}\text{n}\text{t}\text{y}\text{e}\text{x}\text{p}\text{e}\text{n}\text{d}\text{i}\text{t}\text{u}\text{r}\text{e}\text{s}& 20\\ 000\\ 40\\ 000\end{array}$

What is the estimated warranty liability at the end of $2005?$

$58,000$

$$98,000$

$$16,000$

$$38,000$