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retained earnings

Former Member
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Hi

what is meant byretained earnings.

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Answers (2)

Answers (2)

Former Member
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Former Member
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Retained earnings:

Retained aeranings are nothing but accumulated Net income in Balance sheet.

Net income is nothing but proft for a period in a P&L account. At the end of the year the each profit and loss account will be rolled into retained earnings account and the balance become zero. The retained earnings account will be the cumulative net of P&L items which is a BS account. Before u create the CoA u need to designate one account as retained earning a/c and then only u will be allowed to create other accounts. Pl let me know if u have more Qs on this.