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Financial Statements

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  4. What is a Statement of Retained Earnings ?

What is a Statement of Retained Earnings ?

The Statement of Retained Earnings reconciles the net income earned during a given period and any cash dividends paid with the change in retained earnings between the start and end of that period. The basic accounting equation is Beginning Balance, plus Net Income or Loss for the period, minus Dividends declared = Ending balance. The statement of Retained Earnings is frequently combined with the income statement.

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