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Retained earnings represent the cumulative net income of a company that has not been distributed to shareholders as dividends. This figure is crucial for understanding the financial health of a business, as it reflects the company’s ability to reinvest profits back into operations or distribute them to shareholders. Zeroing out retained earnings in QuickBooks, is a process often necessary for closing the books at the end of a fiscal year or for correcting errors in financial statements. Below are detailed guidelines on how to accomplish this effectively.
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