After earning $30 million in net income,Rolatrim Industries distributed $5 million in dividends to their stockholders.The board of directors of the firm decided to invest the remaining $25 million back into the business.This $25 million reinvestment of profits represents:

Question

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The $25 million reinvestment of profits represents retained earnings, which is a portion of a company's profits that is kept by the company rather than distributed as dividends to shareholders. Retained earnings are often used for business expansion or investment in new projects.

After Earning $30 Million in Net Income,Rolatrim Industries Distributed $5