Wilmslow acquired 80% of the equity shares of Zeta on 1 April 2014 when Zeta’s retained earnings were $200,000.

During the year ended 31 March 2015, Zeta purchased goods from Wilmslow totalling $320,000.

At 31 March 2015, one quarter of these goods were still in the inventory of Zeta. Wilmslow applies a mark-up on cost of 25% to all of its sales.

At 31 March 2015, the retained earnings of Wilmslow and Zeta were $450,000 and $340,000 respectively.

What would be the amount of retained earnings in Wilmslow’s consolidated statement of financial position as at
31 March 2015?

A     $706,000
B     $542,000
C     $498,000
D     $546,000