a******s
发帖数: 598 | 1 In the Balance Sheet, the retained earning is typically computed by the
previous ending retained earning plus net income minus any possible dividend.
I used to think that retained earning is like a "savings account" for the
company and the company just adds to it every time by "whatever is leftover"
(net income - dividend).
However I now realized that some of the retained earnings will actually be
used for working capital and capex uses (which is not reflected in the
Income Statement). In this sense, the actual company "savings" (leftover)
is far less than the reported retained earning.
How to understand this issue? It seems to me that the reported retained
earning is inflated and is not really "retained". | p**z
发帖数: 1311 | 2 i thought it's more like equity..
Asset is what you own (cash equipment)
liability is what you owe (debt)
retain earning is then the rest | c******n
发帖数: 15 | 3 Agreed with above.
Assets = Liability + net assets (retained earnings) |
|
