Retained earnings relations. Hewlett-Packard Corporation develops and manufactures a diversified line of computer products. Its sales tend to vary with changes in the business cycle. Selected data from its financial statements for four recent years appear below (amounts in millions):

X Year 9 Retained Earnings, Beginning of Year $16,909 Net Income 2,026 Dividends Declared and Paid 650 Retained Earnings, End of Year ?

Year 10 Year 11 Year 12

$14,097 $13,693

$ 3,697

?

->

621 801 14,097 13,693 11,973

a. Compute the missing amounts for each year.

b. What is the likely reason for the variations in net income and net loss?

c. Why might explain the unusual pattern of dividends over the four-year period?