The post-closing trial balance of Dondec Corporation at December 31, 2014, contains these stockholders' equity accounts.

Preferred Stock (6,000 shares issued) $300,000 Common Stock (350,000 shares issued) 3,500,000 Paid-in Capital in Excess of Par Value--Preferred Stock 250,000 Paid-in Capital in Excess of Par Value--Common Stock 520,000 Retained Earnings 720,000

A review of the accounting records reveals the following: 1. Preferred stock is $50 par, 10%, and cumulative; 6,000 shares have been outstanding since January 1, 2013. 2. Authorized stock is 20,000 shares of preferred and 500,000 shares of common with a $10 par value. 3. The January 1, 2014, balance in Retained Earnings was $800,000. 4. On July 1, 20,000 shares of common stock were sold for cash at $16 per share. 5. A cash dividend of $380,000 was declared and properly allocated to preferred and common stock on October 1. No dividends were paid to preferred stockholders in 2013. 6. Net income for the year was $300,000. 7. On December 31, 2014, the directors authorized disclosure of a $150,000 restriction of retained earnings for plant expansion.

(a) Reproduce the retained earnings account (T-account) for the year. (b) Prepare the stockholders' equity section of the balance sheet at December 31.