Retained earnings are
A)The only motive for purchasing stock.
B)Equal to corporate profits.
C)Direct increases to shareholder wealth.
D)The amount of corporate profit not paid out in dividends.

Question

Quizplus · Accepted Answer

Retained earnings are profits that have not been distributed as dividends to shareholders but are reserved for future use in the growth and development of the company. Therefore, option D, "The amount of corporate profit not paid out in dividends," is the best choice as it accurately describes retained earnings.

Retained Earnings Are