Net Income Statement Of Retained Earnings

The statement of retained earnings or statement of owner s equity is an important part of your accounting process.

Net income statement of retained earnings. The next step involved in calculating the retained earnings balance is to add the net income or net loss for the current accounting period. They can be reported on the balance sheet and earnings statement. The net income is obtained from the income statement profit and loss account which is prepared first before the statement of retained earnings. The statement gives details of retained earnings at the beginning of the current year net income or net loss generated in the current year and the dividend paid throughout the current year.

The company can then reinvest this income into the firm. Retained earnings represent the amount of net income or profit left in the company after dividends are paid out to stockholders.