AOS Industries Statement of Cash Flows for 2008

Operating activities

Net Income 3.4

Depreciation and amortization 1.3

Cash effect of changes in

Accounts receivable 2.1

Accounts payable 1.4

Inventory 0.7

Cash from operating activities 3.3

Investment activities

Capital expenditures

2.2

Acquisitions and other investing activity

0.4

Cash from investing activities

2.6

Financing activities

Dividends paid

1.5

Sale or purchase of stock 2.1

Increase in

shortterm

borrowing 1.4Increase in

longterm

borrowing 3.2

Cash from financing activities 5.2

Change in Cash and Cash Equivalents 5.90

Consider the above statement of cash flows. If all amounts shown above are in millions of dollars, what were AOS Industries' retained earnings for 2008?

A.

$4.90

million

B.

$1.90

million

C.

$3.80

million

D.

$2.70

million