Morgans Lawn Equipment sells high-quality lawn mowers and offers a 3-year warranty on all new lawn mowers sold. In 2017, Morgan sold $319,300 of new specialty mowers for golf greens for which Morgans service department does not have the equipment to do the service. Morgan has entered into an agreement with Mower Mavens to provide all warranty service on the special mowers sold in 2017. Morgan wishes to measure the fair value of the agreement to determine the warranty liability for sales made in 2017. The controller for Morgans Lawn Equipment estimates the following expected warranty cash outflows associated with the mowers sold in 2017.

Year		Cash Flow Estimate			Probability Assessment
2018		$2,410			20%
		4,380			60%
		5,350			20%
2019		$2,820			30%
		5,380			50%
		5,780			20%
2020		$4,190			30%
		5,400			40%
		7,500			30%

Click here to view factor tables Using expected cash flow and present value techniques, determine the value of the warranty liability for the 2017 sales. Use an annual discount rate of 6%. Assume all cash flows occur at the end of the year. (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 458,581.)

The value of the warranty liability for the 2017 sales

$