On January $1,$ JKR Shop had $$550,000$ of beginning inventory at cost$.$ In the first quarter of the year, it purchased $$1,690,000$ of

merchandise, returned $$24,100,$ and paid freight charges of $$38,600$ on purchased merchandise, terms FOB shipping point. The

company's gross profit averages $40\%,$ and the store had $$2,100,000$ of net sales $($at retail$)$ in the first quarter of the year.

Use the gross profit method to estimate its cost of inventory at the end of the first quarter.