Retained Earnings Are a Source of Additional Equity for a Company

question 63

True/False

Retained earnings are a source of additional equity for a company.

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Definitions:

Current Ratio

A financial metric indicating how capable a company is of meeting its short-term liabilities using its available assets.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the business's normal operating cycle.

Fixed Assets

Fixed assets are long-term tangible assets used in a company's operations, such as buildings, machinery, and equipment, which are not expected to be converted into cash in the short term.