Maximum lives and magic:
Begin game play and reach the water level. Find the location in the second stage with platforms that go up. Jump to the top of the platforms to collect an extra life. Continue through the level until reaching the point immediately before the magic book. Take the book and move to the right until a treasure chest appears. Enter the chest to re-appear just past the platforms. Move to the left and jump up the platforms to collect the extra life again. Repeat this process.