Use the Following Information for Questions

Multiple Choice

Use the following information for questions.
Link Co.purchased machinery that cost $810,000 on January 4, 2009.The entire cost was recorded as an expense.The machinery has a nine-year life and a $54,000 residual value.The error was discovered on December 20, 2011.Ignore income tax considerations.
-Before the correction was made, and before the books were closed on December 31, 2011, retained earnings was understated by

A) $810,000.
B) $726,000.
C) $642,000.
D) $558,000.