On December 31, 2015, Denim, Inc. appropriately changed its inventory valuation method to weighted-average cost from FIFO cost for financial statement and income tax purposes. The change will result in a $1,730,000 increase in the beginning inventory at January 1, 2015. Assume a 35% income tax rate. The cumulative effect of this accounting change on beginning retained earnings is

A. 605,000 DECREASE B. 605,000 INCREASE