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Snapbacks Inc., a custom sports hat manufacturer, started operations in 2018 with a capital contribution...

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Snapbacks Inc., a custom sports hat manufacturer, started operations in 2018 with a capital contribution of $100,000. The company leases its facilities under a five-year lease agreement (January 2018-December 2022). Snapbacks declared and paid dividends of $50,000 in 2019 and $100,000 in 2020. The company has been very successful in its first three years and is hoping to expand operations. Snapbacks' bank has requested comparative financial statements (three years) as part of Snapbacks' loan application. Operating information to date follows. 2018 2019 2020 Net income $ 135,000 $ 165,000 $ 180,000 Total assets 1,785,000 1.844.000 2,066,000 Total liabilities 1,550,000 1,494,000 1,636,000 The accountant preparing the statements discovers that $50,000 in leasehold improvements (installed in January 2018) was expensed in error. 1. In the 2020 comparative financial statements, what would Snapbacks report for December 31, 2020, Total Equity and Retained earnings, respectively, after the accountant makes the corrections? (Ignore income taxes. Assume all other amounts are fairly stated.) O A) $480,000: $380,000 OB) $400,000; $300,000 OC) $370,000: $270,000 OD) $450,000: $350,000

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