On January 1, 2010, the Merchandise Inventory of Morton, Ltd

Multiple Choice

On January 1, 2010, the merchandise inventory of Morton, Ltd.was $1.2 million.During 2010 Morton purchased $2,300,000 of merchandise and recorded sales of $2.7 million.The gross profit rate on these sales was 35%.
What is the merchandise inventory of Morton at December 31, 2010?

A) $1,125,000.
B) $1,745,000.
C) $1,765,000.
D) $945,000.