In 2014, Pollard 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		3%
Second year of warranty		5%

Sales and actual warranty expenditures for 2014 and 2015 are presented below:

		2014		2015
Sales		$500,000		$700,000
Actual warranty expenditures		30,000		50,000

What is the estimated warranty liability at the end of 2015?(assume the accrual method)

A. 20,000

B. 64,000

C. 16,000

D. 96,000