Asked by Nancy Lainez on Jun 10, 2024
Verified
Retained Earnings represents past net income less past dividends; therefore, any balance in this account would be listed on the income statement.
Retained Earnings
The portion of net income not distributed as dividends but retained by the company to reinvest in its business or to pay debt.
Net Income
The final income of a firm following the deduction of all expenditures, taxes, and interest from the gross revenue.
Dividends
Payments made by a corporation to its shareholder members, usually as a distribution of profits.
- Understand the role of retained earnings in financial reporting and the process of closing entries.
Verified Answer
Learning Objectives
- Understand the role of retained earnings in financial reporting and the process of closing entries.
Related questions
The Balance in Retained Earnings Should Be Interpreted as Representing ...
The Net Increase or Decrease in Retained Earnings for a ...
The Ending Balance of Retained Earnings Is
The Effect of Closing Revenues and Expenses to Retained Earnings ...
Retained Earnings Are the Existing Shareholders' Reinvested Profit and Do ...