Sheridan Company includes one coupon in each bag of dog food it sells. In return for eight coupons, customers receive a leash. The leashes cost Sheridan $3 each. Sheridan estimates that 60 percent of the coupons will be redeemed. Data for 2020 and 2021 are as follows:

		2020		2021
Bags of dog food sold		500000		580000
Leashes purchased		17000		24000
Coupons redeemed		120000		150000

The premium liability at December 31, 2020 is

$86250.

$74250.

$64250.

$67500.