Problem $2-$Income statement and retained earnings statement $(35$ Points$)$

Present below is information related to Roses Paper Company Limited for $2022$

Other information:

Roses Paper Company Limited decided to discontinue its entire retail operations and to

retain its manufacturing and wholesale operations. On September $15,$ Caribbean Paper

Company sold the retail operations to Caribbean Paper Company Limiled. During $2022,$

there were $700,000$ shares of common stock outstanding all year.

Recognition of income earned in $2020$ but omitted from income statement in that year $($net

of tax$)$ by the financial controller for $$65,900.$

There is also a cumulative effect on income of prior years in changing from LIFO to FIFO

inventory valuation in $2021($net of tax$)$ that was omitted by the financial controller for

$$99,800.$

Instruction:

Prepare a multiple$-$step income statement and a retained eamings statement.