By subtracting dividends paid to shareholders from the net income, which of the following are managers able to calculate?
A) a change in the cash balance in the firm's bank account
B) a change in retained earnings
C) a decrease in profit margins
D) an increase in net income

Question

Quizplus · Accepted Answer

By subtracting dividends paid to shareholders from net income, managers are able to calculate the change in retained earnings. Retained earnings is the portion of net income that is kept in the company, rather than distributed to shareholders as dividends.

By Subtracting Dividends Paid to Shareholders from the Net Income