Retained Earnings Statement

On January $1,$ Sherwood Company had retained earnings of $$18,300.$ During the year, Sherwood had revenues of $$837,800$ and expenses of $$791,900,$ and paid cash dividends in the amount of $$38,620.$

Required:

Determine the amount of Sherwood's retained earnings at December $31.$

$$

Conceptual Connection: Comment on Sherwood's dividend policy.

Sherwood is paying $$ : of its income to its shareholders in the form of dividends. This $$ dividend payout will result in investors receiving relatively more of the company's earnings in $$ during the year.