Baker Corporation changed from the LIFO method to the FIFO method for inventory valuation during 2018. Baker has an effective income tax rate of 30 percent and 100,000 shares of common stock issued and outstanding. The following additional information is available:

	Cost of goods sold				Cost of goods sold								After-tax
	FIFO				LIFO				Difference				Difference
Prior to 2018	$	40,000			$	75,000			$	35,000			$	22,750
1st quarter 2018		10,000				18,000				8,000				5,200
Net income before the effect of accounting change:
1st quarter 2017					$	300,000
1st quarter 2018					$	500,000

Assuming Baker makes the change in the first quarter of 2018, how much is reported as net income for the first quarter of 2018?

A. $527,950.

B. $505,200.

C. $494,800.

D. $492,000.

E. $500,000.