Schumacher Company uses the perpetual inventory system, and it engaged in the following transactions during 2014:

1) Started the business by issuing common stock for $7,500 cash

2) Paid cash to purchase $5,000 of inventory

3) Sold inventory that cost $3,000 for $7,250 cash

4) Incurred and paid operating expenses, $250

Schumacher Company engaged in the following transactions during 2015:

1) Paid cash to purchase $5,800 of inventory

2) Sold inventory that cost $7,000 for $15,150 cash

3) Incurred and paid operating expenses, $500

The amount of Retained Earnings at December 31, 2014 is:

A) $4,250.

B) $11,150.

C) $11,650.

D) $4,000.