During the first year of operations, the McCormick Company incurred the following manufacturing costs; Direct materials, $5 per unit, Direct Labor, $3 per unit, Variable overhead, $4 per unit, and Fixed overhead, $200,000. The company produced 25,000 units, and sold 17,500 units, leaving 7,500 units in inventory at year-end. Income calculated under variable costing is determined to be $345,000. How much income is reported under absorption costs?