1. The stockholders equity of Innovative Fitness Products Inc. at December 31, 2013 appears below:

Common Stock, $8 par value, 200,000 shares

authorized, 120,000 shares issued and outstanding $960,000

Paid in Capital in excess of par value $500,000

Retained earnings $740,000

During 2014, the following transactions occurred:

June 15: Declared a 10% stock dividend when the market value was $15 per share

June 30: Issued the stock dividend declared on June 15

December 10: Declared a cash dividend of $1.50 per share to be paid in January 2015

December 31: Recognized net income of $376,000

The balance in retained earnings at 2014 year-end is:

a. $738,000

b. $756,000

c. $822,000

d. $918,000

e. $936,000