On January 1, Pyle Company purchased an asset that cost $43,500 and had no estimated residual value.

The estimated useful life of the asset is 6 years and straight-line depreciation is used.

An error was made in the current year because the total amount of the asset’s cost was debited to an expense account, and no depreciation was recorded.

Pretax income for year was $44,000 before correction of the error.

How much is the correct pretax income?

- $36,750.
- $87,500.
- $80,250.
- $51,250.