Llamado Corporation was organized on began operations immediately. Unfortunately, the company hired an incompetent bookkeeper. For the years 2018 through 2020, the bookkeeper presented an annual balance sheet that reported only one amount for shareholders' equity. Also, the condensed income statement reported as follows: 2018, net loss, P175,000; 2019, net profit, P220,OOO; and 2020, net profit P410,OOO. The president has recommended to the board of directors that a cash dividend of P450,000 be declared and paid during January 2021. The outside director on the board has objected on the basis that the companVs financial statements contain major errors (there has never been an audit). You have been engaged to clarify the situation. The single shareholders' equity account, provided by the bookkeeper, appeared as follows: Shareholders' Equity 2018 2018 2019 Share issue costs Net loss Bought 10,000 shares from An unhappy shareholder X P 15,000 175,000 70,000 55,000 50,000 200 ooo P 555,000 2018 2019 2019 2020 2020 Ordinary shares, par P5 200,000 shares issued Net profit (including PIOO,OOO land write-up based on president's estimate) Ordinary shares, 2,000 shares issued Depreciation expense* (2018, P15,ooo; 2019, 17,000; 2020, 23,000) Miscellaneous expense*' (2018, 20,000; 2019, 25,000; 2020, 5,000) 2020 Cash loan to the company president 220,000 18,000 Sold 5,000 shares of X's shares 27,000 Net profit 410 ooo P 2,275,000 *Recorded as expense but not shown on the income statement.