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On its 2004 balance sheet, Sherman Books showed $510 million of retained earnings, and exactly the same amount was shown the following year. Assuming that no earnings restatements were issued, which of the following statements is CORRECT?a. The company must have had zero net income in 2005.b. The company must have paid no dividends in 2005.c. Dividends could have been paid in 2005, but they would have had to equal the earning for the year.d. If the company lost money in 2005, they must have paid dividends.e. The company must have paid out half of its earnings as dividends.
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