On January 1, 2019, Kelly's total assets amounted to P8,200,000; while total liabilities were P2,600,000. Total retained earnings was P1,000,000. Included in the shareholders' equity as of this date was 10,000, P10 par callable preference shares which were originally issued at P15 per share. During 2019, these callable preference shares were bought back by Kelly at P18 per share. Total assets at the end of the year increased by P2,500,000. P1,600,000 of the unpaid liabilities at the beginning of the year were paid during the year. Total operating expenses amounted to P8,000,000; 25% of such amount is not yet paid as of the end of the year. 13. Determine the decrease in Kelly's retained earnings as a result of the redemption of the callable preference shares. 14. Determine Kelly's net income during 2019