How are retained earnings calculated? Retained earnings calculation formula

Retained earnings = undistributed profits + surplus reserve, which is more than the net profit of the current year, because there is a surplus reserve withdrawn from previous years. Retained earnings refer to the internal accumulation of enterprises that are extracted or formed from the profits realized over the years, including surplus reserves and undistributed profits. ”

Retained earnings refer to the internal accumulation of enterprises that are extracted or formed from the profits realized over the years, including surplus reserves and undistributed profits. Surplus reserve refers to the accumulated funds withdrawn from the net profit of the enterprise in accordance with the relevant regulations. The surplus reserve of a corporate enterprise includes the statutory surplus reserve and the discretionary surplus reserve.

Statutory surplus reserve refers to the surplus reserve withdrawn from the net profit of the enterprise in accordance with the prescribed proportion. Discretionary surplus reserve refers to the surplus reserve withdrawn by the enterprise in accordance with the resolution of the shareholders' meeting or the general meeting of shareholders. The surplus reserve withdrawn by the enterprise can be used to cover losses, increase capital, or distribute cash dividends or profits, etc., when approved.

Undistributed profit refers to the profit of the enterprise after making up for the loss, withdrawing the surplus reserve and distributing the profit to investors, and the profit is retained in the enterprise over the years. Relative to the rest of the owner's equity, the business has greater autonomy over the use of undistributed profits.

Retained earnings are calculated:

Retained earnings = undistributed profits + surplus reserve, which is more than the net profit of the current year, because there is a surplus reserve withdrawn from previous years.

For example: 09 years of total profit of 1 million yuan, deduction of income tax 100 * 25% = 250,000 yuan, after-tax net profit of 750,000 yuan, surplus reserve is generally 10% of after-tax profits, that is, 10,000 yuan, if dividends of 10,000 yuan (that is, 30% of after-tax profits), retained yield = 1 - dividend distribution rate, in this case the retained yield of 1-30% = 70%.

Retained yield refers to the ratio of net income after deducting all dividends to net income, which is used to measure how much of the total current income remains in the company for the development of the company. Usually new listings, developing public companies, and companies that are perceived as progressively have higher retained yields.

Retained earnings are calculated: retained earnings, undistributed profits, and surplus reserves.

Tools Raw Materials:

Lenovo computer Thinkbook 14-lll

Windows 10 Home Chinese Edition.

Microsoft Office Excel 20161, first click to open the "Stay in earnings" calculation**.

2. Then enter the formula " " sign.

3. Then subtract the "income tax rate" from "1".

4. Multiply by "Total Profit".

5. Then add "surplus reserve". Retained earnings are calculated: retained earnings, undistributed profits, and surplus reserves.

6. Finally, press the "Enter key" to determine and calculate the total amount of retained earnings. That's it.

Retained earnings = undistributed profits + surplus reserve。Retained earnings refer to the internal accumulation of enterprises that are withdrawn from the profits realized over the years or retained by the enterprise, including the surplus reserve and undistributed profits of the enterprise. The content of retained earnings is the internal accumulation of retained earnings that is extracted or formed by the enterprise from the profits realized in previous years, including surplus reserve and undistributed profits.

Advantages of retained earningsNot incurring actual cash expenditures is different from debt financing, which does not have to pay regular interest, and unlike ** financing, which does not have to pay dividends. At the same time, it also exempts expenses such as handling fees and issuance fees related to liabilities and equity financing. However, there is an opportunity cost to this approach, i.e., the necessary rate of return for shareholders to invest their money in other projects.

Maintaining an enterprise's ability to borrow, and the retained earnings are essentially part of shareholders' equity, which can be used as the basis for an enterprise's external borrowing. The first use of this part of the funds to raise funds, reduce the need for external funds, when the enterprise encounters a project with a high rate of profitability, and then to external financing, and Xiaodo will not be difficult to raise funds because the company's debt has reached a high level.

Retained yield is the ratio of a company's after-tax earnings minus the difference between the accrued gold dividend and the after-tax earnings. Its main function is to reflect the part of the company that may be used for enterprise development, and its calculation formula is: retained rate of return = retained earnings net profit * 100% = net profit - profit distributed to shareholders).

The formula for calculating retained earnings is as follows: retained earnings = Faye fixed surplus reserve + arbitrary surplus reserve + undistributed profits.

Contents of Retained EarningsRetained earnings are the internal accumulation of enterprises that are withdrawn from the profits realized over the years or retained in the form of celebrations, including surplus reserves and undistributed profits. The retained earnings difficulties incurred by enterprises are mainly extracted from net profits.

Retained earnings are earnings that arise when a customer purchases a product or service and then uses it or buys it again for a period of time. The way retained earnings are calculated typically includes multiple metrics and factors, which can vary between different industries and companies. Generally speaking, the calculation of retained earnings can be based on the two-sensitivity method:

Simple and complex methods.

The simple method refers to dividing the revenue generated by customers after purchasing a product or service in a certain period by the total revenue in that period, and the percentage obtained is the indicator of retained earnings. For example, if the total revenue of a public bridge dry chong division in the past quarter is 1 million yuan, of which the income from old customers is 200,000 yuan, then the retained rate of return is 20%. Although the calculation method of the simple method is relatively simple, its results may be affected by factors that do not take into account product or service upgrades, changes, customer churn, etc.

The complex method is more detailed and accurate, and it calculates retained earnings by considering multiple factors such as customer retention, customer lifetime value, number of customers, etc. Among them, the customer lifetime price loss value refers to the total value generated by a customer to the company during his use cycle, including the value brought by the initial purchase, repurchase, referral and other behaviors. Customer retention rate and number of customers are measures of customer retention, as well as the size and market share of a company, respectively.

Considering these factors together, more accurate retained earnings data can be obtained, which can guide the company to develop a more scientific marketing strategy.

It is worth noting that there are many factors that need to be considered in the process of calculating retained earnings, such as customer satisfaction, market competition, etc. Therefore, companies need to develop appropriate methods and indicators to calculate retained earnings according to their own circumstances.

In practice, calculating and analyzing retained earnings can not only be used to assess a company's sales and customer service levels, but also to help companies better understand the needs and preferences of customers, so as to develop strategies that are more in line with market trends and customer needs. At the same time, when looking at retained earnings, companies need to continuously improve their service levels and product quality, increase customer trust and loyalty, and ultimately obtain sustainable economic benefits. <>

The retained income of an enterprise refers to the internal accumulation of profits that an enterprise extracts or retains from the profits realized in the past blind years, and belongs to all the equity items of the transferees of the accounting account.

The retained earnings of the enterprise include: statutory surplus reserve, discretionary surplus reserve, and undistributed profits.

Retained earnings = surplus reserve + undistributed profits.

Retained earnings refer to the profits created by the company in the course of operation, but due to the needs of the company's business development or statutory reasons, etc., which are not distributed to the owners and retained in the company, and the calculation method is: retained earnings = undistributed profits + surplus reserve. Including surplus reserve and undistributed profits, surplus reserve refers to the accumulated funds withdrawn from net profits by enterprises in accordance with relevant regulations; Undistributed profit is the profit that the business retains for distribution or to be distributed in subsequent years.

Data development. Enterprises should set up "surplus reserve" accounts to account for the increase and decrease of the withdrawal and use of surplus reserves, and set up three detailed accounts under the "surplus reserve" account, namely "statutory surplus reserve", "arbitrary surplus reserve" and "statutory public welfare fund", to account for the various surplus reserves and their use from net profits.

The undistributed profits of the enterprise should be accounted for through the "Profit Distribution" account. At the end of the year, the enterprise should transfer the net profit realized for the whole year from the "current year's profit" account to the "profit distribution - undistributed profit" account, and transfer the balance of other relevant detailed accounts under the "profit distribution" account to the "undistributed profit" detailed account. After the carry-forward, the credit balance of the "Undistributed Profit" detail account is the amount of accumulated undistributed profit.

In the case of a debit balance, the amount of accumulated uncovered losses is indicated. For the uncovered loss, the pre-tax profit realized in the following years can be used to make up for the pre-tax loss, but the recovery period shall not exceed five years.

Enterprises should account for the withdrawal and use of surplus reserve through the "surplus reserve" account, and carry out detailed accounting of "statutory surplus reserve" and "arbitrary surplus reserve" respectively.

When an enterprise withdraws surplus reserve in accordance with the regulations, the account of "Profit Distribution - Withdrawal of Statutory Surplus Reserve and Withdrawal of Arbitrary Surplus Reserve" shall be debited and the account of "Surplus Reserve" shall be credited. When the general meeting of shareholders or similar institutions decides to use the surplus reserve to make up for the loss or increase the capital, the "surplus reserve" account is debited and the "profit distribution - surplus reserve to make up for the loss" and "paid-in capital (or share capital)" account are credited. When the general meeting of shareholders resolves to use the surplus reserve to distribute new shares, the "surplus reserve" account will be debited according to the amount calculated by the distribution of new shares, and the total face value calculated according to the **par value and the total number of new shares distributed shall be credited to the "share capital" account.