Final answer:
The statement of retained earnings is reviewed by investors to understand a company's c) dividend history and decisions about d) reinvesting earnings for future growth.
Step-by-step explanation:
Investors typically scrutinize a company's statement of retained earnings to gauge information about the company's dividend history. The statement of retained earnings provides insights into the company's decisions regarding the use of its profits. Companies may choose to reinvest their earnings to support future growth, or they may distribute a portion of the earnings as dividends to their shareholders. Particularly, early-stage investors or venture capitalists may monitor how a small company with little to no profits opts for reinvesting profits rather than paying out dividends in order to finance expansion and growth strategies. This reinvestment is critical as it can help ensure that the company does not become overleveraged with debt such as bonds, which would require interest payments, possibly burdening the company's cash flow.