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Questions
What are retained profits?
Briefly explain the concept of retained profits.
Briefly explain the following source of finance.
Retained profits
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Solution
Retained profits refer to the profits that have not been distributed as dividends but have been kept for use within the business. These profits are usually retained in the form of general reserves or retained earnings, which can be used for various purposes, including business expansion, purchasing new assets, research and development, debt repayment, or as a financial cushion during economic downturns.
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RELATED QUESTIONS
Select the correct answer from the options given below and rewrite the statement.
Retained earnings are ______ source of financing.
Answer in one sentence.
What are retained earnings?
Correct the underlined word and rewrite the following sentence.
Retained earnings is an external source of finance.
Study the following case/situation and express your opinion.
The Balance-sheet of a Donald Company for the year 2018-19 reveals equity share capital of Rs. 25,00,000 and retained earnings of Rs. 50,00,000.
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Justify the following statement.
Retained earning is simple and cheapest method of raising finance.
What is retained earnings? Explain Determinants of retained earnings.
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What are retained earnings?
Discuss the advantages of retained profits as a source of finance.
Discuss the disadvantages of retained profits as a source of finance.
