retained earnings definition

retained earnings

Profits generated by a firm that are not distributed to stockholders (shareholders) as dividends but are either reinvested in the business or kept as a reserve for specific objectives (such as to pay off a debt or purchase a capital asset). Balance sheet figure shown under the heading retained earnings is the sum of all profits retained since the firm's inception. Retained earnings are reduced by losses, and are also called accumulated earnings, accumulated profit, accumulated income, accumulated surplus, earned surplus, Undistributed Earning, or undivided profits. See also retention ratio.

retained earnings is in the Accounting & Auditing, Banking, Commerce & Finance and Investing subjects.

retained earnings appears in the definitions of the following terms: equity, capitalization (cap), accumulation, accumulated profits, undivided profits, return of capital, undistributed earnings, reserves, Modiglani-Miller hypothesis, earned surplus and

retained earnings appears in the other terms: appropriation of retained earnings, statement of retained earnings

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