On January 15, 2018, Vern Purchased the Rights to a Mineral

On January 15, 2018, Vern purchased the rights to a mineral interest for $3,500,000. At that time it was estimated that the recoverable units would be 500,000. During the year, 40,000 units were mined and 25,000 units were sold for $800,000. Vern incurred expenses during 2018 of $500,000. The percentage depletion rate is 22%. Determine Vern's depletion deduction for 2018.

A) $150,000
B) $175,000
C) $176,000
D) $200,000
E) $250,000