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Retained profits

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Definition of Retained profits

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Retained profits

The amount of profit after deducting interest, taxation and dividends that is retained by the business.



Related Terms:

Shareholders’ funds

The capital invested in a business by the shareholders, including retained profits.


Retained earnings

Accounting earnings that are retained by the firm for reinvestment in its operations;
earnings that are not paid out as dividends.


RETAINED EARNINGS

profits a company plowed back into the business over the years. Last January’s retained earnings, plus the net income or profit that a company made this year (which is calculated on the income statement), minus dividends paid out, equals the retained earnings balance on the balance sheet date.


Retained earnings

The residual earnings of the company.


Retained earnings

A company’s accumulated earnings since its inception, less any distributions to shareholders.



retained earnings

Earnings not paid out as dividends.


Retained Earnings

Net profits kept to accumulate in a business after dividends are paid.


Retained Profits Image 2

Statement of retained earnings

An adjunct to the balance sheet, providing more detailed information about the beginning balance, changes, and ending balance in
the retained earnings account during the reporting period.


Statement Retained Earnings

One of the basic financial statements; it takes the beginning balance of retained earnings and adds net income, then subtracts dividends. The Statement of retained Earnings is prepared for a specified period of time.


owners' equity

Refers to the capital invested in a business by its shareowners
plus the profit earned by the business that has not been distributed
to its shareowners, which is called retained earnings. Owners’
equity is one of the two basic sources of capital for a business, the other
being borrowed money, or debt. The book value, or value reported in a
balance sheet for owners’ equity, is not the market value of the business.
Rather, the balance sheet value reflects the historical amounts of capital
invested in the business by the owners over the years plus the accumulation
of yearly profits that were not paid out to owners.



 

 

 

 

 

 

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