Retained earnings are the portion of earnings kept rather than paid out as dividends.
Retained Earnings Calculator
Results
Dividends distributed
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Retained earnings
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Retained earnings per share
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Table of Contents
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What is Retained Earnings?
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How to Use This Calculator
- Enter or select Earnings, Dividend payout ratio, Number of shares outstanding.
- Check the unit beside each measurement. For a percentage or rate, use the scale and time period stated in the form.
- Choose Calculate, then compare the output with the formula and example below. If you change a value or option, calculate again to update the result.
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Formula Used
Retained portion = earnings × (1−dividend payout ratio)
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Variables Explained
| Input | What it means |
|---|---|
| Earnings | Use the measured or stated value for this item, with the unit or category shown beside the field. |
| Dividend payout ratio | An investment-income payment; the perpetuity formula uses the next expected payment. |
| Number of shares outstanding | The share count corresponding to the stated price or earnings period. |
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Worked Example
Earnings of 100,000 with a 30% payout leave 70,000 retained for the period.
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Why Use This Calculator?
Compare the result with the underlying statement, budget or proposed transaction. It is most useful when every amount uses the same reporting period and the same accounting definition.
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Common Mistakes
- Current-period retained earnings are not the same as the accumulated balance on the balance sheet.
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Frequently Asked Questions
Should I use monthly or annual figures?
Use one consistent period for every amount and rate in the relationship. If a form specifies an annual rate or a monthly amount, follow that label rather than mixing time periods.
Does the result include fees and tax?
Only the costs and taxes represented by the inputs and formula are included. A real transaction can include other charges, so compare the estimate with the underlying agreement or statement.
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Sources & References
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