Could someone confirm that's the correct definition of R.E. I thought R.E. is net not pay out dividend but my professor has in his note as "Retained Earnings = Earnings less dividends"

According to the following definition from the following site, Smallbusinessdictionary.com - A Small Business Dictionary of Business Planning Terms: Part of the SMBTN™ Network (http://www.smbtn.com/smallbusinessdictionary/)


Retained Earnings

Net profits or earnings retained by the company rather than disbursing to the shareholders in the form of dividends. Retained earnings are used to improve the business through development programs, promotion, R&D, etc.

Opening RE + Net Income – Dividends = Closing RE

Retained Earnings is where all the profit of the company goes. Dividends decrease the equity of a company, so it comes out of RE.

I thought R.E. is net not pay out dividend

Are you trying to say the net of what is not paid out in dividends? If so, that's actually correct, except that you're leaving out net of what. i.e. it's the net left over of earnings that was not paid out in dividends, but accumulated over the years. (i.e. not just this year)

Every definition you've been given is saying the same thing in different ways.

If I have only ending retained earnings and dividend figure, can I calculate net income?

You should be able to if there are no other issues such as prior year adjustments