Quiz – T/F: Retained earnings account on the balance sheet does not represent cash

Fundamentals of Financial Management, Concise

Brigham and Houston

09th Edition and 10th Edition

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Determine if the following is true or false:

Retained earnings as shown on the balance sheet don't represent cash. Instead, it represents part of the stockholders' claim against the firm's existing assets. Retained earnings are essentially stockholders' reinvested earnings.

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