Holt Developments Ltd. put an asset in service on January 1, 2021. Its cost was $432,000, its predicted service life was six years, and its expected residual value was $43,200. The company decided to use double-declining-balance depreciation. After consulting with the companys auditors, management decided to change to straight-line depreciation in 2023, without changing either the original service life or residual value. Required: a. What is depreciation expense for 2023?

b. Calculate the effect of this change on retained earnings.