20. The bookkeeper for the Kristine Company prepared the following income statement and retained earnings statement for the year ended December 31, 2021:

Kristine Company

December 31, 2021

Expense and Profits

Sales (net )

P1,568,000

Less: Selling expenses

( 156,800)

Net sales

1,411,200

Add: Interest revenue

18,400

Add: Gain on sale of equipment

25,600

Gross sales revenue

1,455,200

Less: Costs of operations

Cost of goods sold

P960,800

Correction of overstatement in last year'sincome due to error (net of P13,200 income tax credit)

30,800

Dividend costs (P4 per share for 8,000 ordinary shares)

32,000

Loss due to earthquake

33,600

(1,057,200)

Taxable revenues

398,000

Less: Income tax on income from continuing operations

(99,840)

Net income

298,160

Miscellaneous deductions

Loss from operations of discontinued Segment X44 (net of P7,200 income tax credit)

16,800

Administrative expenses

134,400

(151,200)

Net revenues

P146,960

Kristine Company

Retained Revenue Statement

For the Year Ended December 31, 2021

Beginning retained earnings

P474,400

Add: Gain on sale of Segment X44 (net of P10,800 income taxes)

25,200

Recalculated retained earnings

499,600

Add: Net revenues

146,960

646,560

Less: Interest expense

(27,200)

Ending: retained earnings

P619,360

The preceding account balances are correct but have been incorrectly classified in certain instances.

Based on the above and the result of the audit, answer the following:

1. The income from continuing operations for the year ended December 31, 2021 is

a. 207,760 b. 199,360 c. 299,200 d. 226,560

2 The income (loss) from discontinued operations for the year ended December 31, 2021 is

a. 8,400 b. (16,800) c. 25,200 d. 0

3. The profit for the year ended December 31, 2021 is

a. 234,960 b. 307,600 c. 209,760 d. 207,760

4. The balance of retained earnings as of December 31, 2021 should be

a. 619,360 b. 646,560 c. 650,160 d. 709,360