Retained earnings are reported on both the income statement and the statement of stockholders' equity.

Question

Quizplus · Accepted Answer

Retained earnings are reported on the statement of stockholders' equity, not on the income statement. The income statement reports a company's revenues and expenses, leading to net income or loss, while retained earnings reflect the cumulative amount of net income retained in the business after dividends are paid out.

Retained Earnings Are Reported on Both the Income Statement and the Statement