Puppy Company includes one coupon in each bag of dog food it sells. In return for 4 coupons, customers receive a toy dog that the company purchases for $1.20 each. Puppy Company's experience indicates that 60% of the coupons will be redeemed. Information for 2020 is as follows: The amount of estimated liability for premiums on the 12/31/20 balance sheet is:

Select one:

a.

$6,000

b.

$18,000

c.

$24,000

d.

$35,000

e.

$48,000