The distinction between paid-in capital and retained earnings is not made for ________.
A) corporations
B) corporations and partnerships
C) corporations and sole proprietorships
D) partnerships and sole proprietorships

Question

Quizplus · Accepted Answer

The distinction between paid-in capital and retained earnings is specific to corporations, which have a more complex structure allowing for the issuance of stock and the retention of earnings. Partnerships and sole proprietorships have simpler structures and do not make this distinction, as they do not issue stock and typically distribute profits directly to the owners.

The Distinction Between Paid-In Capital and Retained Earnings Is Not