Sandhill, Inc. is a calendar-year corporation whose financial statements for 2020 and 2021 included errors as follows: Year Ending Inventory Depreciation Expense 2020 $284000 overstated $230000 overstated 2021 124000 understated 84000 understated Assume that purchases were recorded correctly and that no correcting entries were made at December 31, 2020, or at December 31, 2021. Ignoring income taxes, by how much should Sandhill's retained earnings be retroactively adjusted at January 1, 2022?

a $270000 increase

b $14000 increase

c $40000 decrease

d $94000 increase