Sandhill Co. incurred the following costs during 2018:

Significant modification to the formulation of a chemical product	$156000
Trouble-shooting in connection with breakdowns during commercial
production	146000
Cost of exploration of new formulas	196000
Seasonal or other periodic design changes to existing products	181000
Laboratory research aimed at discovery of new technology	351000

In its income statement for the year ended December 31, 2018, Sandhill should report research and development expense of

A) 703,000

B) 1,030,000

C) 849,000

D) 884,000