Sheridan Company sells its product for $27 per unit. During 2022, it produced 26000 units and sold 15000 units (there was no beginning inventory). Costs per unit are: direct materials $7, direct labour $6, and variable overhead $5. Fixed costs are: $312000 manufacturing overhead, and $91000 selling and administrative expenses. Cost of goods sold under absorption costing is

$502500.

$270000.

$780000.

$450000.