Use the Following Information for Questions

Multiple Choice

Use the following information for questions.
Fairfax Inc.began operations on January 1, 2016.Financial statements for 2016 and 2017 contained the following errors: In addition, on December 31, 2017 fully depreciated equipment was sold for $7,200, but the sale was NOT recorded until 2018.No corrections have been made for any of the errors.Ignore income tax considerations.
-The total effect of the errors on Fairfax's retained earnings at December 31, 2017 is that the balance is understated by

A) $82,200.
B) $67,200.
C) $46,200.
D) $34,200.