The primary components of the stockholders' equity section of a balance sheet for a corporation are
A) A capital amount for each stockholder in the corporation
B) Net income and retained earnings
C) Common stock and dividends
D) Common stock and retained earnings
E) None of the above

Question

Quizplus · Accepted Answer

The primary components of the stockholders' equity section of a corporation's balance sheet are common stock and retained earnings. Common stock represents the equity held by the shareholders, while retained earnings are the portion of net income that is not distributed as dividends but retained by the company for reinvestment.

The Primary Components of the Stockholders' Equity Section of a Balance