What is the difference between paid-in capital and retained earnings?

Definition of Paid-in Capital

Paid-in capital is one of the major categories of stockholders' equity. Generally, paid-in capital reports the amount that a corporation received from its stockholders (or shareholders) in exchange for the newly issued shares of its capital stock.

Paid-in capital is also referred to as contributed capital and as permanent capital.

Definition of Retained Earnings

Generally, retained earnings is the cumulative amount of after-tax net income earned by the corporation since its inception minus the dividends that have been distributed to its stockholders since the corporation began.

Free Financial Statements Cheat Sheet

543,463
Subscribers
You are already subscribed. This offer is not available to existing subscribers.
Error: You have unsubscribed from this list.
Step 2: Please check your email.