Olivia Company began $2019$ with a Retained Earnings account balance of $$180,000.$ During $2019,$ the following $8$ events occurred and were properly recorded by the company:

Bonds payable with a face value of $$100,000$ were issued on January $1$ at $98.$ The bonds mature in $10$ years. The bond provisions require the restriction of retained earnings $($by means of a note to the financial statements$)$ equal to one$-$half the face value of the bonds during the period the bonds are outstanding.

On April $13,$ Olivia reissued $2,400$ shares of treasury stock for $$25$ per share. The company had reacquired these shares in $2017$ at a cost of $$20$ per share. At that time, it had restricted retained earnings $($by means of a note to the financial statements$)$ in an amount equal to the cost of the treasury shares.

On January $5,$ Olivia recalled and retired $800$ shares of $$100$ par preferred stock at the call price of $$120$ per share. The stock had originally been issued for $$108$ per share.

During June, Olivia declared and issued a $2-$for$-1$ stock split on its common stock, reducing the par value from $$10$ to $$5$ per share. Immediately prior to the split, $10,000$ shares of common stock were outstanding. The stock market price on the date of the split was $$25$ per share.

In August, Olivia declared and issued a $15\%$ stock dividend when the common stock was selling at $$13$ per share.

During December, Olivia declared and paid its annual $$1\mathrm{.}30$ per share cash dividend on the outstanding common stock.

Net income amounted to $$72,000.$

During the year$-$end audit, it was found that in $2018,$ Olivia had recorded depreciation on a particular machine twice. The error resulted in a $$13,000$ overstatement of depreciation during $2018.$ It was also found that, due to an oversight, a $$10,000$ loss on the sale of land was omitted from the $2018$ income statement. Both items are material. The company has been subject to a $30\%$ income tax rate for several years.

Required:

Prepare Olivia's statement of retained earnings and any related notes to its financial statements for the year ended December $31,2019.$

OLIVIA COMPANY

Statement of Retained Earnings

For Year Ended December $31,2019$

Retained earnings, as previously reported, January $1,2019$ $fill in the blank $1$

$180,000$

Add: Correction of overstatement in $2018$ depreciation $($net of income taxes$)$

Add: Correction of overstatement in $2018$ depreciation $($net of income taxes$)$

Less: Correction of omission of $2018$ loss on sale of land $($net of income tax credit$)$

Less: Correction of omission of $2018$ loss on sale of land $($net of income tax credit$)$

Adjusted retained earnings, January $1,2019$ $fill in the blank $6$

Add: Net income

Add: Net income

$fill in the blank $9$

Less: Stock dividends

$Less: Stock dividends

Less: Cash dividends

Less: Cash dividends

Less: Reduction of retained earnings due to a retirement of preferred stock

Less: Reduction of retained earnings due to a retirement of preferred stock

Less: Reduction of retained earnings due to a retirement of preferred stock

Retained earnings, December $31,2019$ $fill in the blank $17$

$175,600$