Buy custom Understanding Financial Statements
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| Topic: |
Business
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| Number of pages / Number of words: |
3 / 815 |
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“If the company’s revenue exceeds its expenses the income statement will report net income; otherwise it will report a net loss.â€
Retained earnings statement will direct external users of how much was previously distributed to them and other owners of the business in the form of dividends and how much was kept in reserve to allow the company future growth...
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Retained earnings should be considered as net income on the financial statements. When organizing the Retained Earnings Statement the beginning balance should go on the first line along with the start date of the reporting. The net income (which you will get from the income statement) is added to the opening balance (retained earnings) and the dividends, or payments to stockholders on a regular basis, are deducted from the net income...
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