El 2-18 Sasha Company reported retained earnings at December 31,2007, of $310,000. Sasha had 200,000 shares of common stock outstanding throughout 2008.

The following transactions occurred during 2008.

1. An error was discovered: in 2006, depreciation expense was recorded at $70,000, but the cor¬

rect amount was $50,000.

2. A cash dividend of $0.50 per share was declared and paid.

3. A 5% stock dividend was declared and distributed when the market price per share was $15 per share.

4. Net income was $285,000.

Instructions Prepare a retained earnings statement for 2008.