The following information pertains to Taylor Corporation:

- Dividends on its 2,000 shares of 12%, P 15 par cumulative preference shares have not been declared or paid for two years.

- Treasury shares that cost P 35,000 was reissued for P 23,000.

What amount of retained earnings should be appropriated as a result of these items?

a. P 35,000

b. P 12,000

c. P 23,000

d. P 0