Retained earnings are part of the Shareholders' Equity indicating the portion of NET Income that is reinvested in the company.

The sample book and sample statement that accompany this help article detail how the Net Income (loss) is booked into the Shareholders equity as Retained Earnings.

Net income

In 2018 the Net Income (Loss) of the Saas startup is (1,939.83) in the sample book.

Retained Earnings

To book the loss of 2018 as a Retained Earning, post the following transaction.

Note: - Income Summary is grouped in the Net Income group zeroing it when

Retained Earnings are booked into the Shareholders Equity.

Balance Sheet

To complete the Shareholders' Equity on the Balance Sheet, the Retained Earnings can be fetched just like common stock or other Shareholders' Equity items.

Note: Since No Dividends were paid Total Equity and Total Shareholders' Equity match (G48)

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