In general, retained earnings represents accumulated earnings of the corporation less dividends paid.

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Retained earnings represent the cumulative amount of net income that a corporation has earned over its lifetime, minus any dividends that have been distributed to shareholders. This figure is an important component of a company's equity and reflects the portion of profits that have been reinvested in the business rather than paid out to shareholders.When a company earns a profit, it has a few options on what to do with those earnings. It can distribute them as dividends to shareholders, it can reinvest them back into the company for growth and expansion, or it can do a combination of both. The portion that is reinvested is recorded in the retained earnings account, which is found in the equity section of the company's balance sheet.
Retained earnings are used by the company for a variety of purposes, such as funding new projects, purchasing new assets, reducing debt, or expanding into new markets. The management of the company decides how to allocate these funds in a way that they believe will maximize shareholder value.
The formula for calculating retained earnings is as follows:
Retained Earnings = Beginning Retained Earnings + Net Income (or Loss) - Dividends Paid
Where:
- Beginning Retained Earnings is the balance of retained earnings at the start of the period (e.g., the beginning of the fiscal year).
- Net Income (or Loss) is the profit or loss the company made during the period.
- Dividends Paid is the total amount of dividends that were distributed to shareholders during the period.
Over time, retained earnings can be a significant source of internal financing for a company, as they can be used to support business operations without the need to take on additional debt or issue new shares of stock. The retained earnings balance can fluctuate from year to year depending on the company's profitability and dividend policy.

In General, Retained Earnings Represents Accumulated Earnings of the Corporation