ECONOMICS

Detailed explanation-1: -Retained earnings are the net profit left after paying dividends to its shareholders. The decision of retaining profits earned is determined by the company’s management. A growth company prefers to use earnings to fund expansion activities instead of paying dividends.

Detailed explanation-2: -Retained profit, also known as retained earnings, is the portion of a company’s profits that is not paid out as dividends to shareholders but is instead retained by the company for future use.

Detailed explanation-3: -There are three main measures of profit. These are gross profit, operating profit and net profit.

Detailed explanation-4: -Retained earnings are the amount of profit a company has left over after paying all its direct costs, indirect costs, income taxes and its dividends to shareholders. This represents the portion of the company’s equity that can be used, for instance, to invest in new equipment, R&D, and marketing.

Detailed explanation-5: -A dividend is a share of profits and retained earnings that a company pays out to its shareholders and owners.