I have the Sears version of this radio, The VCO loop and the oscillators are giving me a hard time so I had to park it for a while, to ease my headache. Model # 934.38260700.
After peaking 204 turn off the tone and double check the carrier balance (RT & CT201) then back to using a continuos tone, when you get to T402 and T403 turn the tone/mic input level down until the wattage drops to 1 or 2 watts and adjust them each a little at a time to get the highest low watt peak. Then turn it back up to normal and continue. And like Brandon says Redoo RT402 (ALC) at the end to your liking.
I usualy set ALC with the 2 tone and a scope till the tops of the "eggs" start to flatten or stretch a little, then back it off to round them out again.