On December 31, 2014, Pacer Co adopted the dollar-value LIFO retail Inventory method. Inventory data for 2015 are as follows:

Inventory, 12/31/14

	Lifo Cost	Retail
Inventory,12/31/14	$750,000	$1,050,000
Inventory, 12/31/15	?	1,375,000
Increase in price level for 2015		10%
Cost to retail ratio for 2015		70%

Under the LIFO retail method, Pacer's inventory at December 31, 2015 should be

A.904,000

B.962,500

C.977,500

D.1,000,250

I know the answer is A, but can you please show the steps in order to get that answer, as well as an explanation on how to get those numbers.