As of December 31, 2016, Warner Corporation reported the following:

Dividends payable	$31,000
Treasury stock	710,000
Paid-in capital - share repurchase	31,000
Other paid-in capital accounts	5,100,000
Retained earnings	$4,100,000

During 2017, half of the treasury stock was resold for $262,000; net income was $710,000; cash dividends declared were $1,610,000; and stock dividends declared were $610,000.

The 2017 sale of half of the treasury stock would:

Reduce income before tax by $93,000

Reduce retained earnings by $93,000

Reduce retained earnings by $62,000

Increase total shareholders' equity by $355,000