Explain and report changes to retained earnings and accumulated other comprehensive income. - Retained earnings represents the
Question:
Explain and report changes to retained earnings and accumulated other comprehensive income.
- Retained earnings represents the earnings that the corporation elects not to pay out in dividends.
- Ending retained earnings is calculated by adding net income to beginning retained earnings and subtracting dividends declared.
- Retained earnings can be restricted, which communicates to shareholders that this portion of retained earnings is not eligible for dividend payout.
- Certain nonowner transactions are included in the accumulated other comprehensive income account in the shareholders' equity section of the statement of financial position.
Step by Step Answer:
Cornerstones Of Financial Accounting
ISBN: 9780176707125
2nd Canadian Edition
Authors: Jay Rich, Jefferson Jones, Maryanne Mowen, Don Hansen, Donald Jones, Ralph Tassone