During its first year of operations, the McCormick Company incurred the following manufacturing costs: Direct materials, $4 per unit, Direct labor, $2 per unit, Variable overhead, $3 per unit, and Fixed overhead, $256,000. The company produced 32,000 units, and sold 26,500 units, leaving 5,500 units in inventory at year-end. Income calculated under variable costing is determined to be $380,000. How much income is reported under absorption costing?

$336,000

$424,000

$636,000

$380,000