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प्रश्न
Study the following case/situation and express your opinion.
The Balance-sheet of a Donald Company for the year 2018-19 reveals equity share capital of Rs. 25,00,000 and retained earnings of Rs. 50,00,000.
- Is the company financially sound?
- Can the retained earnings be converted into capital?
- What type of source retained earning is?
उत्तर
- Yes. Since the company has a sufficient amount of capital (equity share capital of ₹ 25,00,000 and retained earnings of ₹ 50,00,000), it can be called financially sound.
- Yes, the retained earnings are converted into capital. The retained earnings cannot be an initial source of capital but they can be an important source when the company runs its business profitably. The management can convert such earnings into permanent share capital by issuing bonus shares.
- Retained earnings are an internal source of finance or a form of owned capital.
संबंधित प्रश्न
Answer the question.
Discuss three advantages of plowing hack of profit, from the company’s point of view.
What has retained earnings? Explain any two of its merits and two of its demerits.
Select the correct answer from the options given below and rewrite the statement.
Retained earnings are ______ source of financing.
Write a word or a term or a phrase that can substitute the following statement.
The policy of using undistributed profit for the business.
Find the odd one.
Answer in one sentence.
What are retained earnings?
Correct the underlined word and rewrite the following sentence.
Retained earnings is an external source of finance.
Justify the following statement.
Retained earning is simple and cheapest method of raising finance.
What is retained earnings? Explain Determinants of retained earnings.
Explain any four disadvantages of Retained Earnings.
What are retained earnings?
What are retained profits called "self financing"?
What are retained profits?
Discuss the advantages of retained profits as a source of finance.
Discuss the disadvantages of retained profits as a source of finance.
