Braum Dairy Produces Milk to Sell to Local and National

Multiple Choice

Braum Dairy produces milk to sell to local and national ice cream producers.Braum Dairy began operations on January 1, 2011 by purchasing 650 milk cows for $780,000.The company controller had the following information available at year end relating to the cows: On Braum Dairy's income statement for the year ending December 31, 2011, what amount of unrealized gain on harvest milk will be reported?

A) No gain is reported until the milk is sold.
B) $8,200
C) $36,200
D) $205,800.