P Limited keeps a provision for doubtful debts account. On 1 April 2022, the balance on this account was $6200. The provision ought to have been raised to $7400 on 31 March 2023, but this adjustment was not entered. What effect did this error have on the retained earnings in the statement of financial position on 31 March 2023?
- Aoverstated $1200
- Boverstated $7400
- Cunderstated $1200
- Dunderstated $7400