The stockholders' equity of Crater Inc. at December 31, 2016, appears below:

Common stock, $25 par value, 200,000 shares authorized,135,000

  shares issued and outstanding

3,375,000

Paid-in capital in excess of par value

1,750,000

Retained earnings

2,575,000

During 2017, the following transactions occurred:

May 10:

Declared a 10% common stock dividend when market value was $50 per share

August 31:

Issued the stock dividend declared on June 15.

December 10:

Declared a cash dividend of $3.50 per share to be paid in January 2018.

December 31:

Recognized net income of $1,630,500.

Compute the year-end balance of the retained earnings for 2017.