Rolt Company began 2013 with a $135,000 balance in retained earnings. During the year, the following events occurred:
1. The company earned net income of $75,000.
2. A material error in net income from a previous period was corrected. This error correction increased retained earnings by $9,800 after related income taxes of $4,200.
3. Cash dividends totaling $12,500 and stock dividends totaling $20,000 were declared.
4. One thousand shares of callable preferred stock that originally had been issued at $120 per share were recalled and retired at the beginning of 2013 for the call price of $130 per share.
5. Treasury stock (common) was acquired at a cost of $23,000. State law requires a restriction of retained earnings in an equal amount. The company reports its retained earnings restrictions in a note to the financial statements.
Prepare a statement of retained earnings for the year ended December 31, 2013.