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accounting form showing the beginning balance of retained earnings, adjustments to it during the year, and ending balance. The retained earnings statement may be presented separately or in a combined statement of income and retained earnings. An illustrative retained earnings statement follows:
Retained Earnings-Unadjusted beginning balance
Plus or Minus: Prior period adjustments
Retained Earnings-Adjusted beginning balance
Plus: Net income
Retained Earnings-Ending balance
reconciliation of the beginning and ending balances in the retained earnings account on a company's balance sheet . It breaks down changes affecting the account, such as profits or losses from operations, dividends declared, and any other items charged or credited to retained earnings. A retained earnings statement is required by Generally Accepted Accounting Principles whenever comparative balance sheets and income statements are presented. It may appear in the balance sheet, in a combined Profit and Loss Statement and retained earnings statement, or as a separate schedule. It may also be called statement of changes in earned surplus (or retained income).
Copyright © 2006, 2003, 1998, 1995, 1991, 1987, 1985 by Barron's Educational Series, Inc. Reprinted by arrangement with Publisher.
Copyright © 2007, 2000, 1997, 1987, by Barron's Educational Series, Inc. Reprinted by arrangement with Publisher.