During the year ended 30 June 2016, the directors of Cooma Ltd paid a final dividend out of retained earnings of $60 000, which had been recommended at the end of the previous financial year. They also declared and paid an interim dividend of $150 000 on 1 February 2017. The balance of the Retained Earnings account at 1 July 2016 was $200000. 

At 30 June 2017, the ledger accounts showed that the company had made a total profit of $1000000 for the year. However, the directors determined that the following adjustments were still necessary to finalise the accounts. 

1. Provide for an income tax liability of $300000. 

2. Recommend the payment of a final dividend of $100000 out of retained earnings. 

3. Transfer $175 000 to a general reserve and $100000 to a plant replacement reserve.

Required

A. Prepare journal entries to record all transactions above for the year ended 30 June 2017.

B. Prepare the Retained Earnings account for the year ended 30 June 2017.