Perkins Company owns 85% of Sheraton Company. Perkins Company sells merchandise to Sheraton Company at 20% above cost (gross profit). During 2011 and 2012, such sales amounted to $400,000 and $500,000, respectively. At the end of each year, Sheraton Company had sold all of inventory purchased from Perkins to third parties. Calculate the amount of unrealized inventory profit for 2011 and 2012?

a. $400,000 for 2011 and $500,000 for 2012

b. $80,000 for 2011 and $100,000 for 2012

c. $0 for 2011 and $100,000 for 2012

d. $80,000 for 2011 and $0 for 2012

e. $0 for 2011 and $0 for 2012