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    cettin's Avatar
    cettin Posts: 1, Reputation: 1
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    #1

    Dec 2, 2007, 04:24 PM
    Retained earnings
    I need to calculate the retrained earnings for 06 and 05
    For 06 I only have the revenue and expenses figures
    For 05 I have the assets, liabilities, capital stock and dividends

    How do I calculate the retained earnings for the 2 years

    Thanks :)
    CaptainForest's Avatar
    CaptainForest Posts: 3,645, Reputation: 393
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    #2

    Dec 4, 2007, 02:30 PM
    I assume you mean ending RE?

    Ending RE for 2005:
    Assets = Liabilities + Capital Stock – Dividends – Retained Earnings

    Therefore,
    Ending RE 2005 = Liabilities + Capital Stock – Dividends – Assets


    As for 2006:
    Opening RE (which is the ending 2005 RE which you just calculated above)
    Plus Revenue
    Less Expenses
    Equals Closing RE 2006
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