Increases in Retained Earnings from a Company's Earnings Activities Are

question 45

Multiple Choice

Increases in retained earnings from a company's earnings activities are:

• A)Assets
• B)Revenues
• C)Liabilities
• D)Stockholder's Equity
• E)Expenses

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Definitions:

Net Income

The total profit of a company after all expenses and taxes have been deducted from total revenue.

Return On Equity

This is a measure of financial performance calculated by dividing net income by shareholders' equity, indicating how much profit a company generates with the money shareholders have invested.

Retained Earnings

Retained earnings represent the cumulative amount of net income a company retains for reinvestment in its operations rather than paying it out as dividends.

Stockholders' Equity

The residual interest in the assets of a corporation after deducting its liabilities, representing ownership interest.