Krepps Corporation produces a single product. Last year, Krepps manufactured 27,540 units and sold 22,200 units. Production costs for the year were as follows:

Direct materials	$ 214,812
Direct labor	$ 121,176
Variable manufacturing overhead	$ 239,598
Fixed manufacturing overhead	$ 302,940

Sales totaled $1,098,900 for the year, variable selling and administrative expenses totaled $115,440, and fixed selling and administrative expenses totaled $176,256. There was no beginning inventory. Assume that direct labor is a variable cost.

Under absorption costing, the ending inventory for the year would be valued at:

Multiple Choice

• $231,846

• $170,346

• $197,846

• $240,346