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LeMay Frosted Flakes Company offers its customers a pottery cereal bowl if they send in 4 boxtops from LeMay Frosted Flakes boxes and $1.00. The

LeMay Frosted Flakes Company offers its customers a pottery cereal bowl if they send in 4 boxtops from LeMay Frosted Flakes boxes and $1.00. The company estimates that 60% of the boxtops will be redeemed. In 2015, the company sold 500,000 boxes of Frosted Flakes and customers redeemed 220,000 boxtops receiving 55,000 bowls. If the bowls cost LeMay Company $2.50 each, how much liability for outstanding premiums should be recorded at the end of 2015?

A. $ 10,500

B. $ 20,000

C. $ 30,000

D. $ 40,500

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