Assume that Sammy's Pizza paid a $2,750 dividend to stockholders in year 2. What would Sammy's Pizza report for net income and retained earnings for year 2 and year 3?
a) NI: $6,750; RE: $4,000
b) NI: $6,750; RE: $7,750
c) NI: $7,750; RE: $7,750
d) NI: $4,000; RE: $6,750