$38.$ Lauretta Company reported the following shareholders equity on January $1,2015$:Share capital $1,500,000$Share premium $3,000,000$Retained earnings $2,000,000$The entity had $400,000$ authorized shares of P$5$ par value, of which $300,000$ shares were issued and outstanding. On June $30,2015,$ the entity acquired $50,000$ shares forP$10$ per share to be held as treasury. The shares were originally issued at P$8$ per share. The cost method is used to account for treasury shares.On November $1,2015,$ the entity declared and distributed a property dividend of inventory payable on July $1,2016.$ The inventory had a P$750,000$ carrying amount and a P$600,000$ fair value on November $1,2015.$ The inventory had a fair value of P$800,000$ on December $31,2015,$ and P$900,000$ in July $1,2016.$ The net income for $2015$ was P$2,500,000.$What amount should be reported as unappropriated retained earnings on December $31,2015?$A$.3,250,000$B$.3,200,000$C$.3,400,000$D$.3,700,000$