A corporation's "E&P" account is equal to the company's "retained earnings" account on itsfinancial balance sheet.

Question

Quizplus · Accepted Answer

E&P (Earnings and Profits) is a tax concept used to determine a corporation's ability to pay dividends out of its profits, while retained earnings are an accounting concept reflecting the company's accumulated net income minus dividends paid to shareholders. E&P and retained earnings can differ due to differences in tax and financial accounting rules.

A Corporation's "E&P" Account Is Equal to the Company's "Retained