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14. The following information relates to the Smith Company for 2002:
| Cash dividend declared | $ 300 |
| Retained earnings, January 1, 2006 | ? |
| Net income | 580 |
| Error in 2005 - overstatement of ending inventory; error found in 2006 | 150 |
| Retained earnings, December 31, 2006 | 1,400 |
What was the unadjusted January 1, 2006, balance in retained earnings?
| a. | $1,420 |
| b. | $1,120 |
| c. | $1,270 |
| d. | $1,170 |
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