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Problem 2-18 (AICPA Adapted) Shaw Company provided the following trial balance on December 31, 2019 which had been adjusted except for income tax expense: Cash 600,000 Accounts receivable 2.800.000 Inventory 2,000,000 Property, plant and equipment (net) 10,500,000 Accounts payable and accrued liabilities 1,800,000 Income tax payable 1.500.000 Deferred tax liability 700.000 Share capital 2,500,000 Share premium 3,000,000 Retained earnings, January 1 3,500,000 Net sales and other revenue 15,000,000 Costs and expenses 10,000,000 Income tax expense 2.100.000 28,000,000 28.000.000 The accounts receivable included P1,000,000 due from a customer and payable in quarterly installments of P125,000. The last payment is due December 30, 2021. During the year, estimated tax payment of P600,000 was charged to income tax expense. The income tax rate is 30%. On December 31, 2019, what amount should be reported as 1. Total current assets? a. 3,400,000 b. 4,400,000 c. 5,400,000 d. 4,900,000 2. Total current liabilities? a. 2,700,000 b. 3,300,000 c. 4,050,000 d. 3,450,000 3. Retained earnings? a. 8,500,000 b. 6,400,000 c. 7,000,000 d. 3,500,000 70