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What is profit retention?

Updated: 10/19/2022
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13y ago

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it is the profit that is not distributed to the owners. In an LLC, the earnings are the property of the owners in direct relationship to the amount of stock. But the company can not afford to distribute that profit to the owners when there is inventory to build, receivables that are not collected, bills to pay, and maybe equipment to purchase.

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13y ago
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