Problem 4-10 A combined statement of income and retained earnings for Ayayai Ltd. for the year ended December 31, 2017, follows. (As a private company, Ayayai has elected to follow ASPE.) Also presented are three unrelated situations involving accounting changes and the classification of certain items as ordinary or unusual. Each situation is based on the combined statement of income and retained earnings of Ayayai Ltd. Ayayai Ltd. Combined Statement of Income and Retained Earnings For the Year Ended December 31, 2017 Sales revenue $ 5,730,000 Cost of goods sold 2,860,000 Gross profit 2,870,000 Selling, general, and administrative expenses 1,850,000 Income before income tax 1,020,000 Income tax Income before unusual item 306,000 714,000 Loss from tornado (net of taxes) 499,800 214,200 Net income Retained earnings, January 1 Retained earnings, December 31 714,000 $ 928,200 For each of the three unrelated situations, prepare a revised combined statement of income and retained earnings for Ayayai Ltd. The company has a 30% income tax rate.