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Words 917

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|1. (TCO C) |

|On its 1999 balance sheet, Sherman Books showed a balance of retained earnings equal to $510 million. On its 2000 balance sheet, the |

|balance of retained earnings was also equal to $510 million. Which of the following statements is most correct? Show your calculations. |

|a. The company must have had net income equal to zero in 2000. |

|b. The company had a profit in 2000 but did not pay a dividend in 2000. |

|c. the company’s net income in 2000 was $200 million. |

|d. If the company lost money in 2000, they must have paid a dividend. |

|e. None of the statements above is correct. |

|(Points: 20) |

| |

|[pic] |

| |

|2. (TCO D) After-tax returns...

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