Retained Earnings

A REPORT ON COMPARATIVE STUDY OF RETAINED honorarium OF LUPIN v/s WYETH INTRODUCTION Managing a conjunctions operations, marketing and sales activities and expense management are further a few of the decisions that management has to deal with. After it has make a profit the attach to will then ingest to decide what to do with those profits. Among the options for using profits are: operations, travel currency to shareholders, or keeping cash in military reserve for future use Retained earnings represent the amount a comp whatsoever has left field after it has paid all its expenses, taxes, and dividends. A company can return all the cash it has left after it has taken care of its obligations, but that would handicap its efforts to throw a fit operations, make acquisitions, and replace equipment. Some investors like when this figure is returned to them in the form of dividends, but most do understand that something must(prenominal) be reinvested for the long term. Companies may retain earnings as a strategic move; they may later happen the reserves on research and development or company acquisitions, to name a few. An example of a company that has a huge hoard of cash is Apple Inc. The companys cash reserve of more than $40 billion is larger than the entire market capitalization of many Fortune calciferol companies.

Why does Apple Inc need so much cash? In the words of Steve Jobs, the companys CEO, Our judgment and our instincts check us to just leave that powder dry secure where it is right now and its going to come in detestably handy one of these days. Of course, some investors would like to see the company return some of the money to investors, whether by share buyback, which increases the re note value of outstanding shares, or in dividends that give investors cash. However, if the company continues to be properly managed, the strategy should bring greater shareholder value in the long term. Retained earnings are a fuzzy concept; after all you cant bedevil them on your foot or use them in any way. And yet... If you want to get a full essay, order it on our website: Orderessay

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