Explanation
According to the Canadian Investment Funds Course, asset mix rebalancing is the process of restoring the portfolio to its original or target asset allocation by selling or buying assets. Asset mix rebalancing is necessary to maintain the desired level of risk and return, as well as to align the portfolio with the investor's objectives and circumstances. Asset mix rebalancing can be done periodically, such as annually or quarterly, or based on a threshold, such as when an asset class deviates from its target weight by a certain percentage.
In this case, Jerry's asset mix is deviating from the original target asset mix because the stock market has had strong performance. Equities are now over-weighted in Jerry's account. The original target asset mix is still valid since Jerry's situation has not changed. He is invested in several bond and equity mutual funds.
Therefore, the best course of action is to advise him to sell a portion of assets invested in equity funds and reinvest the proceeds into bond funds. This will bring his portfolio back to its target asset mix and reduce his exposure to equity risk.
The other options are not advisable because:
* Advising him to change his know your client (KYC) form to reflect more growth would imply that his risk tolerance and objectives have changed, which is not the case. Changing the KYC form would also require a new suitability assessment and documentation.
* Advising him to do nothing since equities could outperform bonds in the next year would ignore the importance of asset mix rebalancing and expose him to more risk than he is comfortable with. Doing nothing would also mean that his portfolio is not aligned with his original plan and expectations.
* Advising him to sell a portion of assets invested in bond funds and reinvest the proceeds into equity funds would further increase his equity weight and risk, which is contrary to his original target asset mix and risk tolerance.
Therefore, the correct answer is D. advise him to sell a portion of assets invested in equity funds and reinvest the proceeds into bond funds.
References: 1: Canadian Investment Funds Course - IFSE Institute 2 (Unit 10: Portfolio Management)

Explanation
A company's retained earnings statement is a financial statement that shows how the company's net income is distributed between dividends paid to shareholders and retained earnings, which are the amount of profit that is reinvested in the company. Retained earnings are part of the company's equity, and they reflect the accumulated earnings that the company has generated over its history, minus any dividends or distributions.
Retained earnings can be used by the company for various purposes, such as expanding its operations, developing new products, paying off debt, or buying back shares1 References = Canadian Investment Funds Course, Unit 5: Types of Investments, Lesson 3: Equity Securities, Section 5.3.4: Financial Statements