October 30, 2016 admin

Retained Earnings

Liabilities and Net Worth

RETAINED EARNINGS NET WORTH ACCOUNT
2810

ACCOUNT EXPLANATION
Net profit, after income tax and dividend distributions, accumulated in prior years and retained in the business.
TRANSACTIONS
  Jrnl. Dr. Cr.
  Entry to close net profit for the year, after income tax, into this account G
    Net Profit or (Loss) After Income Tax 2850
      Retained Earnings 2810
             
  Entry to close declared dividends for the year into this account G
    Retained Earnings 2810
      Dividends Declared 2820
COMMENTS
  • This account should be used only by dealerships operating as corporations.
  • Adjustments relating to transactions of a prior year should not be debited or credited to this account unless they would materially distort operating results of the current year.
  • Transactions involving dividends other than cash or in excess of retained earnings should be handled in accordance with the advice of legal and tax counsel.