q.13

In 2018, due to a change in marketing forecasts, Barney Corporation reduced the projected life of its patent for producing round dice. The cumulative patent amortization prior to 2018 would have been $11 million higher had the new life been used. Barney's tax rate is 35%. Barney's retained earnings as of December 31, 2018, would be (Round million answer to 2 decimal places.):

Multiple Choice

• Overstated by $7.15 million.

• Unaffected.

• Overstated by $11 million.

• Overstated by $3.85 million.