The net income for Year 1 (the first year of operations for the company) was $21,000 and dividends of $12,500 were paid. In Year 2, the company reported net income of $35,000 and paid dividends of $5,500. At the end of Year 1, the company had total assets of $160,000. At the end of Year 2, the company had total assets of $250,000.

What was the amount of retained earnings at the end of Year 1?