The Solar Lighting Corporation has been a leading lighting retailer in the Philippines since it opened in the 1960s. They offer a comprehensive range of lighting fixtures ensuring that they have the latest styles, trends, and innovations for energy efficient solutions. They also offer a consulting lighting design service to tailor the perfect lighting plan to their clients' spaces. Shown below is the balance sheet of the company for the previous year: E Solar Lighting Corporation Balance Sheet As of December 31, 2017 Assets Liabilities Cash P1 ,338,018 Accounts Payable P 293,425 Accounts Receivable 388,125 Salaries Payable 465,750 Merchandise Inventory 1 16,197 Deferred Revenue 373,450 Prepaid Rent 47,506 Equities Land P1 ,067,000 Capital Stock P1 ,531,800 Building 2,007,900 Other Paid-In Capital 1,280,400 Less: Accumulated Depreciation (213,400) Retained Earnings 806,521 Total Assets P4,751,346 Total Liabilities and Equity P4,751,346 Solar Lighting Corporation falls within the 30% corporate income tax rate on its earnings, which doesn't have to be paid until March 30, 2019. Prepare an income statement in proper format for the calendar year ended December 31 , 2018. (4 pts) Construct the statement of retained earnings. (5 pts) Prepare a balance sheet in proper format as of the calendar year ended December 31, 2018. (6 pts) The following transactions occurred during 2018: 1. The company obtained a P185,000 short-term interestbearing loan from one of its stockholders. They signed a note for the loan and received cash in the amount of P185,000. Interest rate per annum for this loan is 7.5%, to be paid at the end of January of the following year. (4 pts) . The company purchased merchandise costing P675,000 throughout the year. Their usual practice is to purchase 40% on credit and pay the rest in cash. (3 pts) . On January 1, 2018, the company purchased a 5-year insurance policy worth P70,000. P14,000 of which expired on December 31, 2018. (4pts) . Solar Lighting Corporation issued 100,000 shares of stocks at par value of P18.00 per share to various individuals in return for cash payments, which amounted to P2,500,000. (3 pts) . Inventory worth P500,000 was sold at a marked-up price of 55%. 3/5 of these were paid in cash. . However, sales returns amounted to P25,000. This was to be deducted from the customer's account. (2pts) . By the end of the year, Solar Lighting still had P150,000 unearned income. (2 pts} . Depreciation for the year amounted to P125,000. (2pts) Salaries of employees worth P800,000 was paid in cash. This includes the wages of employees from previous period. (3pts) 10.The Board of Directors declared a P80,000 dividends to its stockholders to be paid on February 28, 2019. (2 pts)