Business earns money through different ways, Although some ways are following :
What is paid-up capital?
Paid-up capital is the capital which is generated by shareholders.
It can be defined as the amount collected from shareholders (no matter whether it is from primary market or from open market) and add up in the company's capital is known as paid-up capital.
Difference between Paid- in capital and Retained earnings?
Paid-in Capital=
Paid-in capital, also referred to as contributed capital.
Paid in capital represents the funds raised by the business from equity, and not from ongoing operations.
It refers to capital contributed to a corporation by investors through purchase of stock from the corporation not from other stock holders.
It is the amount that the corporation received from stockholders when the corporation issued its stock. Paid-in capital is also referred to as permanent capital.
Retained Earnings=
Retained Earnings can be defined as
the amount of Net income which is earned after paying tax since the establishment of the company minus the dividend which has been distributed to the shareholders.
It can also be defined as It is the percentage of net earnings not paid out as dividends, but retained by the company to be reinvested in its core business, or to pay debts or kept as a reserve for specific objectives (for purchasing a capital asset).
It is recorded under shareholders' equity on the balance sheet.
What is paid-up capital?
Paid-up capital is the capital which is generated by shareholders.
It can be defined as the amount collected from shareholders (no matter whether it is from primary market or from open market) and add up in the company's capital is known as paid-up capital.
Difference between Paid- in capital and Retained earnings?
Paid-in Capital=
Paid-in capital, also referred to as contributed capital.
Paid in capital represents the funds raised by the business from equity, and not from ongoing operations.
It refers to capital contributed to a corporation by investors through purchase of stock from the corporation not from other stock holders.
It is the amount that the corporation received from stockholders when the corporation issued its stock. Paid-in capital is also referred to as permanent capital.
Retained Earnings=
Retained Earnings can be defined as
the amount of Net income which is earned after paying tax since the establishment of the company minus the dividend which has been distributed to the shareholders.
It can also be defined as It is the percentage of net earnings not paid out as dividends, but retained by the company to be reinvested in its core business, or to pay debts or kept as a reserve for specific objectives (for purchasing a capital asset).
It is recorded under shareholders' equity on the balance sheet.
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