Joe Novak Corporation Reports the Following Information: Correction of Overstatement

Multiple Choice

Joe Novak Corporation reports the following information: Correction of overstatement of depreciation expense $\begin{array}{lr}\text { in prior years, net of tax } & \$ 215,000 \\\text { Dividends declared } & 160,000 \\\text { Net income } & 500,000 \\\text { Retained earnings, } 1 / 1 / 07 \text { as reported } & 1,000,000\end{array}$ Joe Novak should report retained earnings, 1/1/07, as adjusted at

A) $785,000.
B) $1,000,000.
C) $1,215,000.
D) $1,555,000.