A statement of retained earnings shows the changes in retained earnings over time, often a year. Retained earnings are profits leftover after paying dividends.

The retained earnings account carries the undistributed profits of your business. As Corporate Finance Institute reports, to calculate retained earnings, add the net income or loss to the opening ...

For example, if the beginning retained earnings balance is $100,000, net income is $50,000 and dividend payments are $25,000, the ending retained-earnings balance is $125,000 ($100,000 + $50,000 ...

Retained earnings are the cumulative net earnings (profit) of a company after paying dividends; they can be reported on the balance sheet and earnings statement.

Revenue vs. Retained Earnings: An Overview . Revenue and retained earnings provide insights into a company’s financial performance. Revenue is a critical component of the income statement.

An accurate statement of retained earnings will tell investors and other interested parties how a company uses its profits. This can help determine if a company is using its revenue efficiently.

Over the course of the fiscal year, the retained earnings statement shows that the company added $12.193 billion in profits to its initial retained earnings.

Retained earnings refer to the portion of a company’s net income that ... Retained earnings are a type of equity listed in the shareholders’ equity section of a company’s financial statements.

Retained earnings offer insight into long-term profitability, but aren’t a one-size-fits-all metric to find the best stocks.

The article How to Calculate Retained Earnings in Stockholder Equity With Common Stock originally appeared on Fool.com. Try any of our Foolish newsletter services free for 30 days .

Calculating Costco's dividends in 2014In 2014, Costco reported net income of $2.058 billion on its income statement. On its balance sheet, it reported having retained earnings of $6.283 billion at ...