Retained Earnings Statement On January 1, Sherwood Company had retained earnings of $18,280. During the year, Sherwood had revenues of $837,000 and expenses of $792,500, and paid cash dividends in the amount of $38,650. Required: 1. Determine the amount of Sherwood's retained earnings at December 31. 2. 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