Retained Eamings Statement D: Rolt Company began 2019 with a $105,000 balance in retained earnings. During the year, the following events occurred: 1. The company earned net income of $86,000. 2. A material error in net income from a previous period was corrected. This error correction increased retained earnings by $10,500 after related income taxes of $4,500. 3. Cash dividends totaling $15,000 and stock dividends totaling $16,000 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 2019 for the call price of $125 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. MERRELL Required: