QUESTIONS: (PLEASE ANSWER ALL, THANK YOU!)

1. Assume Iron appropriated retained earnings in the amount of P70,000 on December 31, 2022. After this action, what would Iron report as total retained earnings in its December 31, 2022, balance sheet?

2. Ignoring income tax, how much is the balance of Retained Earnings on December 31,2022?

Iron Corporation began operations on January 1, 2022. During its first 3 years of operations, Iron reported net income and declared dividends as follows. Net income Dividends Declared 2022 40,000 2023 125,000 50,000 2024 160,000 50,000 The following information relates to 2022 Income before income tax P220,000 Prior period adjustment: understatement of 2020 depreciation expense (before taxes) P 25,000 Cumulative decrease in income from change in inventory methods (before taxes) P 45,000 Dividends declared (of this amount, P25,000 will be paid on January 15, 2022 P100,000