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Question

Leonard Corporation reports the following information:

Correction of overstatement of depreciation expense

in prior years, net of tax                          $   215,000

Dividendsdeclared                                                          160,000

Netincome                                                                      500,000

Retained earnings, 1/1/12,asreported                            2,000,000



Leonard should reportretainedearnings, 12/31/12,at

A)  $1,785,000.

B)         $2,125,000. 

C)  $2,340,000.

D)     $2,555,000.

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