Definition of Accumulated Earnings and Profits

Definition :

Accumulated earnings and profits refers to the net profit of a company which can be left after the payment of dividends to the stockholders of business.It is calculated in the beginning of the year.


Accumulated earnings and profits also includes reserve accounts which are not deduct and which can be included when computing taxable earning. it is also similar to the retained earnings because both the terms are similar in definition i-e net profit of a company after the shareholder distributions.

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