# Calculation of Retained Earnings

Calculation of Retained Earnings
We can calculate retained earnings by using the following equation

\text {Retained earnings = Beginning retained earnings + Net income/loss – Dividends paid}Retained earnings = Beginning retained earnings + Net income/loss – Dividends paid

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Calculation of Retained Earnings
Just from $9/Page Beginning retained earnings: The beginning retained earnings are the previous year’s retained earnings. This is taken from the previous year’s balance sheet of an organization. Net income/Profits: Net income is that portion of the profit that is in the hands of the company after reducing the revenues from all the expenses, be it depreciation, cost of goods sold, interest expenses, salary and remuneration expenses, and adjustment for any extraordinary losses/gains and tax expenses during the year. This is that portion from which dividends can be paid. From Net income, earnings per share (EPS) is calculated. Dividends paid: Dividends are paid out of the net income/profits generated during the year to the company’s shareholders. The amount of dividend to be paid is decided by the Board of directors’ basis on their decisions to invest the net income in projects. Dividends can be paid monthly, quarterly, or semi-annually. It depends upon the management of the organization to when to distribute dividends and how much. Analysis of Retained Earnings: Usually hear three terms vis a vis – Revenue, Profits & Retained earnings. Suppose ABC Ltd sold 1,000 Televisions during the year at the rate of$55,000 each. Thus, Revenue shall be \$55,000,000(\$1000 \times 55,000).$55,000,000($1000Ã—55,000).Then the difference between Profits and Retained earnings is calculated. Profit is that part that the company owns after deducting all the expenses.

For example, there is revenue of $55,000,000. If the cost of goods sold was$38,000,000 and interest expense was $1,900,000. The tax rate for company is 30\%30%, the tax expense would be \left( {55,000,000 – 38,000,000 – 1,900,000} \right){\rm{ }} \times 30\% {\rm{ }} = {\rm{ }}\$ 4,530,000(55,000,000âˆ’38,000,000âˆ’1,900,000)Ã—30%=$4,530,000. Hence net income will be 10,570,000. And then Retained earnings are the part that an organization keeps after paying dividends. There are 10,000 shareholders, and the company decided to pay$76 to each shareholder. Thus, retained earning shall be \left( {10,570,000 – 760,000} \right){\rm{ }} = {\rm{ }}\$9,810,000(10,570,000âˆ’760,000)=$9,810,000.

Analyze the company’s age; usually, the older the companies, we can see more accumulated Retained earnings. Typically, the more profits earned by the company have more retained earnings. As an illustration, Assume the company’s initial RE is $120,000, the company has made a profit of$14,000 (Net Income), and the Board of Directors has decided to distribute a dividend of $2,000. Now, the RE calculation at the end of the financial year will be: Beginning Retained Earning Net Income$14,000
Dividend $2,000 Retained Earnings Beginning Retained Earning + Net Income – Dividend Retained Earnings$132,000

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# Calculation of Retained Earnings

Calculation of Retained Earnings
We can by using the following equation

text {Retained earnings = Beginning retained earnings + Net income/loss – }Retained earnings = Beginning retained earnings + Net income/loss – Dividends paid

Don't use plagiarized sources. Get Your Custom Essay on
Calculation of Retained Earnings
Just from $9/Page Beginning retained earnings: The are the previous year’s retained earnings. This is taken from the previous year’s balance sheet of an organization. Net income/Profits: Net income is that portion of the profit that is in the hands of the company after reducing the revenues from all the expenses, be it depreciation, cost of goods sold, interest expenses, salary and remuneration expenses, and adjustment for any extraordinary losses/gains and tax expenses during the year. This is that portion from which dividends can be paid. From Net income, earnings per share (EPS) is calculated. Dividends paid: Dividends are paid out of the net income/profits generated during the year to the company’s shareholders. The amount of dividend to be paid is decided by the Board of directors’ basis on their decisions to invest the net income in projects. Dividends can be paid monthly, quarterly, or semi-annually. It depends upon the management of the organization to when to distribute dividends and how much. Analysis of Retained Earnings: Usually hear three terms vis a vis – Revenue, Profits & Retained earnings. Suppose ABC Ltd sold 1,000 Televisions during the year at the rate of$55,000 each. Thus, Revenue shall be $55,000,000($1000 times 55,000).$55,000,000($100055,000).Then the difference between Profits and Retained earnings is calculated. Profit is that part that the company owns after deducting all the expenses.

For example, there is revenue of $55,000,000. If the cost of goods sold was$38,000,000 and interest expense was $1,900,000. The tax rate for company is 30%30%, the tax expense would be left( {55,000,000 – 38,000,000 – 1,900,000} right){rm{ }} times 30% {rm{ }} = {rm{ }}$ 4,530,000(55,000,00038,000,0001,900,000)30%=$4,530,000. Hence net income will be 10,570,000. And then Retained earnings are the part that an organization keeps after paying dividends. There are 10,000 shareholders, and the company decided to pay$76 to each shareholder. Thus, retained earning shall be left( {10,570,000 – 760,000} right){rm{ }} = {rm{ }}$9,810,000(10,570,000760,000)=$9,810,000.

Analyze the company’s age; usually, the older the companies, we can see more . Typically, the more profits earned by the company have more retained earnings. As an illustration, Assume the company’s initial RE is $120,000, the company has made a profit of$14,000 (Net Income), and the Board of Directors has decided to distribute a dividend of $2,000. Now, the RE calculation at the end of the financial year will be: Beginning Retained Earning Net Income$14,000
Dividend $2,000 Retained Earnings Beginning Retained Earning + Net Income – Dividend Retained Earnings$132,000

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## Online Academic Help With Different Subjects

### Literature

Students barely have time to read. We got you! Have your literature essay or book review written without having the hassle of reading the book. You can get your literature paper custom-written for you by our literature specialists.

### Finance

Do you struggle with finance? No need to torture yourself if finance is not your cup of tea. You can order your finance paper from our academic writing service and get 100% original work from competent finance experts.

### Computer science

Computer science is a tough subject. Fortunately, our computer science experts are up to the match. No need to stress and have sleepless nights. Our academic writers will tackle all your computer science assignments and deliver them on time. Let us handle all your python, java, ruby, JavaScript, php , C+ assignments!

### Psychology

While psychology may be an interesting subject, you may lack sufficient time to handle your assignments. Don’t despair; by using our academic writing service, you can be assured of perfect grades. Moreover, your grades will be consistent.

### Engineering

Engineering is quite a demanding subject. Students face a lot of pressure and barely have enough time to do what they love to do. Our academic writing service got you covered! Our engineering specialists follow the paper instructions and ensure timely delivery of the paper.

### Nursing

In the nursing course, you may have difficulties with literature reviews, annotated bibliographies, critical essays, and other assignments. Our nursing assignment writers will offer you professional nursing paper help at low prices.

### Sociology

Truth be told, sociology papers can be quite exhausting. Our academic writing service relieves you of fatigue, pressure, and stress. You can relax and have peace of mind as our academic writers handle your sociology assignment.

We take pride in having some of the best business writers in the industry. Our business writers have a lot of experience in the field. They are reliable, and you can be assured of a high-grade paper. They are able to handle business papers of any subject, length, deadline, and difficulty!

### Statistics

We boast of having some of the most experienced statistics experts in the industry. Our statistics experts have diverse skills, expertise, and knowledge to handle any kind of assignment. They have access to all kinds of software to get your assignment done.

### Law

Writing a law essay may prove to be an insurmountable obstacle, especially when you need to know the peculiarities of the legislative framework. Take advantage of our top-notch law specialists and get superb grades and 100% satisfaction.

## What discipline/subjects do you deal in?

We have highlighted some of the most popular subjects we handle above. Those are just a tip of the iceberg. We deal in all academic disciplines since our writers are as diverse. They have been drawn from across all disciplines, and orders are assigned to those writers believed to be the best in the field. In a nutshell, there is no task we cannot handle; all you need to do is place your order with us. As long as your instructions are clear, just trust we shall deliver irrespective of the discipline.

## Are your writers competent enough to handle my paper?

Our essay writers are graduates with bachelor's, masters, Ph.D., and doctorate degrees in various subjects. The minimum requirement to be an essay writer with our essay writing service is to have a college degree. All our academic writers have a minimum of two years of academic writing. We have a stringent recruitment process to ensure that we get only the most competent essay writers in the industry. We also ensure that the writers are handsomely compensated for their value. The majority of our writers are native English speakers. As such, the fluency of language and grammar is impeccable.

## What if I don’t like the paper?

There is a very low likelihood that you won’t like the paper.

### Reasons being:

• When assigning your order, we match the paper’s discipline with the writer’s field/specialization. Since all our writers are graduates, we match the paper’s subject with the field the writer studied. For instance, if it’s a nursing paper, only a nursing graduate and writer will handle it. Furthermore, all our writers have academic writing experience and top-notch research skills.
• We have a quality assurance that reviews the paper before it gets to you. As such, we ensure that you get a paper that meets the required standard and will most definitely make the grade.

### In the event that you don’t like your paper:

• The writer will revise the paper up to your pleasing. You have unlimited revisions. You simply need to highlight what specifically you don’t like about the paper, and the writer will make the amendments. The paper will be revised until you are satisfied. Revisions are free of charge
• We will have a different writer write the paper from scratch.
• Last resort, if the above does not work, we will refund your money.

## Will the professor find out I didn’t write the paper myself?

Not at all. All papers are written from scratch. There is no way your tutor or instructor will realize that you did not write the paper yourself. In fact, we recommend using our assignment help services for consistent results.

## What if the paper is plagiarized?

We check all papers for plagiarism before we submit them. We use powerful plagiarism checking software such as SafeAssign, LopesWrite, and Turnitin. We also upload the plagiarism report so that you can review it. We understand that plagiarism is academic suicide. We would not take the risk of submitting plagiarized work and jeopardize your academic journey. Furthermore, we do not sell or use prewritten papers, and each paper is written from scratch.

## When will I get my paper?

You determine when you get the paper by setting the deadline when placing the order. All papers are delivered within the deadline. We are well aware that we operate in a time-sensitive industry. As such, we have laid out strategies to ensure that the client receives the paper on time and they never miss the deadline. We understand that papers that are submitted late have some points deducted. We do not want you to miss any points due to late submission. We work on beating deadlines by huge margins in order to ensure that you have ample time to review the paper before you submit it.

We have a privacy and confidentiality policy that guides our work. We NEVER share any customer information with third parties. Noone will ever know that you used our assignment help services. It’s only between you and us. We are bound by our policies to protect the customer’s identity and information. All your information, such as your names, phone number, email, order information, and so on, are protected. We have robust security systems that ensure that your data is protected. Hacking our systems is close to impossible, and it has never happened.

## How our Assignment  Help Service Works

#### 1.      Place an order

You fill all the paper instructions in the order form. Make sure you include all the helpful materials so that our academic writers can deliver the perfect paper. It will also help to eliminate unnecessary revisions.

#### 2.      Pay for the order

Proceed to pay for the paper so that it can be assigned to one of our expert academic writers. The paper subject is matched with the writer’s area of specialization.

#### 3.      Track the progress

You communicate with the writer and know about the progress of the paper. The client can ask the writer for drafts of the paper. The client can upload extra material and include additional instructions from the lecturer. Receive a paper.

The paper is sent to your email and uploaded to your personal account. You also get a plagiarism report attached to your paper.

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