Who owns the retained earnings of a public firm?
A) The IRS
B) Common stockholders
C) Bondholders
D) Preferred stockholders

Question

Quizplus · Accepted Answer

Retained earnings belong to the common stockholders of a public firm as they represent the portion of net income that the company has chosen to keep rather than distribute as dividends to shareholders. Bondholders and preferred stockholders do not have claim over retained earnings. The IRS does not own any portion of a company's retained earnings.

Who Owns the Retained Earnings of a Public Firm