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Can I use the company's retained earnings? Print

 

No. Retained earnings represent one of the "owners" of the assets. It is the accumulation of profits that have not been distributed as dividends over the life of a company. These can't be spent again because they have already been spent on plant and equipment, automation, new product lines, acquisitions, etc. This is simply a balance sheet item to account for the increased owner's equity in the company.