Question

87) The credit balance of retained earnings statement represents
A) Undistributed Profit
B) Undisclosed Profit
C) Distributed Profit
D) Unearned Profit​

Answer 1

Correct option A) undistributed profits

Answer 2

The credit balance of retained earnings statement represents Undistributed Profit. (Option A)

• Retained earnings refer to the part of profits generated by a business that is left after distributing dividends to partners.
• This amount is utilized for investing in profitable ventures and opportunities.
• The credit balance signifies a positive balance in the retained earnings statement.
• This statement is created to record the balances, outflows in the form of dividends, etc. which helps in identifying reinvestment plans.