4. Harry Ltd gained control of Potter Ltd on 30 June 2018. Harry applies the diminishing balance depreciation method to equipment at a rate of 40%, and requires this policy to be applied in the consolidation. Potter, however, has applied the straight-line depreciation method to its equipment. Potters equipment was purchased on 1 July 2018 and cost $13,000. At purchase, expectations were that the equipment has a useful life of 5 years and a residual value of $1,000. On 30 June 2020, the consolidation adjustment will include the following line:

A. Dr Retained profits (SOP) $720

B. Dr Retained profits (SOP) $3,520

C. Dr Accumulated depreciation $3,520

D. Dr Depreciation expense $720

Please provide calculation and explanation