Muggs Co. includes one coupon in each bag of dog food it sells. In

return for eight coupons, customers receive a Wreck Em Tech

embroidered leash. The leashes cost Muggs $4 each. Muggs

estimates that 45 percent of the coupons will be redeemed. Data for

2017 (2018) are as follows... Bags of dog food sold: 500,000

(600,000)... Leashes purchased: 18,000 (22,000)... Coupons

redeemed: 120,000 (150,000). The premium liability at December

31, 2017 is

a. 50,000

b. 72,000

c. 60,000

d. 52,500