Accumulated Income


DEFINITION of 'Accumulated Income'

The portion of net income that is retained by a corporation instead of being distributed as dividends. Any accumulated income is typically used by the corporation to reinvest in its principal business or to pay down its debt. Accumulated income appears under shareholder's equity on the corporation's balance sheet.

Also called "retained earnings".

BREAKING DOWN 'Accumulated Income'

Accumulated income refers to the percentage of net income that is accumulated and used for reinvestment purposes or to pay down debt rather than being paid out in the form of dividends. Accumulated income is often invested in areas within the corporation that will create growth opportunities, such as research and development, new technology or machinery, and other forms of capital expenditures.

  1. Dividend

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  2. Appropriated Retained Earnings

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  3. Asset

    1. A resource with economic value that an individual, corporation ...
  4. Net Income - NI

    1. A company's total earnings (or profit). Net income is calculated ...
  5. Retained Earnings

    Retained earnings is the percentage of net earnings not paid ...
  6. Accountant

    A professional who performs accounting functions such as audits ...
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  1. Which transactions affect the retained earnings statement?

    Retained earnings are the portion of a company's income that management retains for internal operations instead of paying ... Read Full Answer >>
  2. Can working capital be depreciated?

    Working capital as current assets cannot be depreciated the way long-term, fixed assets are. In accounting, depreciation ... Read Full Answer >>
  3. Do working capital funds expire?

    While working capital funds do not expire, the working capital figure does change over time. This is because it is calculated ... Read Full Answer >>
  4. How much working capital does a small business need?

    The amount of working capital a small business needs to run smoothly depends largely on the type of business, its operating ... Read Full Answer >>
  5. What does high working capital say about a company's financial prospects?

    If a company has high working capital, it has more than enough liquid funds to meet its short-term obligations. Working capital, ... Read Full Answer >>
  6. How can working capital affect a company's finances?

    Working capital, or total current assets minus total current liabilities, can affect a company's longer-term investment effectiveness ... Read Full Answer >>

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