Situation 1: Novak Stamp Corporation records stamp service revenue and provides for the cost of redemptions in the year stamps are sold to licensees. The stamps can be collected and then redeemed for discounts on future purchases from Novak as an incentive for repeat business. Novak's past experience indicates that only 80% of the stamps sold to licensees will be redeemed. Novak's liability for stamp redemptions was $12,480,000 at December 31, 2022. In 2023, the cost of redemptions for stamps sold prior to January 1, 2023, was $5,760,000. If all the stamps sold in 2023 were presented for redemption in 2024, the redemption cost would be $4,992,000. What amount should Novak report as a liability for stamp redemptions at December 31, 2023? Liability for stamp redemptions