In 2020, Hydrogen Corp. 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 5% warranty Sales and actual warranty expenditures for 2020 and 2021 are presented below: 2020 2021 Sales $450,000 $600,000 Actual warranty expenditures 15,000 30,000 Hydrogen uses the expense approach to account for warranties. What is the estimated warranty liability at the end of 2021? $43,500 $12,000 $28,500 $73,500