Sunday, December 4, 2011

What effect does a debit and a credit do to retained earnings? Does a debit decrease common stock or?

What effect does a debit and a credit do to retained earnings? Does a debit decrease retained earnings or increase it?|||A profitable company with a positive net worth would have a credit balance in retained earnings. A debit to RE would therefore decrease the net worth of a company. A credit would increase it.

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