Eaton CoSells Major Household Appliance Service Contracts for Cash $$\begin{array} { l r } \text { During } 2008 & \$ 380,000 \\\text { During } 2009 & 570,000 \\\text { During } 2010 & 350,000\end{array}$$

Eaton Co.sells major household appliance service contracts for cash.The service contracts are for a one-year, two-year, or three-year period.Cash receipts from contracts are credited to Unearned Service Revenues.This account had a balance of $1,800,000 at December 31, 2007 before year-end adjustment.Service contract costs are charged as incurred to the Service Contract Expense account, which had a balance of $450,000 at December 31, 2007. Service contracts still outstanding at December 31, 2007 expire as follows: $$\begin{array} { l r } \text { During } 2008 & \$ 380,000 \\\text { During } 2009 & 570,000 \\\text { During } 2010 & 350,000\end{array}$$ What amount should be reported as Unearned Service Revenues in Eaton's December 31, 2007 balance sheet?

A) $1,350,000.
B) $1,300,000.
C) $850,000.
D) $500,000.