Rachel, Inc. (Rachel) has a $500,000 airport construction project contract. The estimated total costs are $400,000. In the first year, incurred costs are $200,000. What is Rachels change in retained earnings at the end of the first fiscal year, if it uses the following revenue recognition methods?

Percentage-of-completion Completed contract

$100,000 $50,000 $50,000 $0 $50,000 $50,000 $0 $0