0
Profit reserves refer to the portion of a company's retained earnings that are set aside for specific purposes, such as reinvestment in the business, debt repayment, or future expansion. These reserves are not distributed as dividends to shareholders but are retained to strengthen the company's financial position and support long-term growth strategies. By maintaining profit reserves, a company can ensure it has the necessary funds to navigate economic uncertainties and capitalize on investment opportunities.
What else can I help you with?
What is the difference between Reserves and Provision?
Reserve is a an amount set aside from the profit when it is calculated. On the other hand provision is an amount charged against profit and loss in order to assist in calculating the accurate profit.
How do i find the excess reserves?
To find excess reserves, first determine a bank's total reserves, which includes both required reserves and any additional reserves held. Then, identify the required reserves, calculated as a percentage of the bank's deposits based on regulatory requirements. Subtract the required reserves from the total reserves; the remaining amount is the excess reserves. Formulaically, it can be expressed as: Excess Reserves = Total Reserves - Required Reserves.
Why nature reserves important?
More Nature Reserves will help animals from becoming endangered or extinct.More Nature Reserves will save trees and plants from being cut down.More Nature Reserves will help stop hunting for sport and skins and save hunted animals.
Where does the money come from when you borrow from a bank?
When you borrow money from a bank, the money comes from the bank's deposits and reserves, which are funds that the bank holds from its customers and other sources. The bank uses these funds to lend to borrowers, charging interest on the loans as a way to make a profit.
Why is it important to categorise the reserves of the subsidiary company into pre-acquisition reserves and post-acquisition reserves for purpose of consolidation?
pre or post acquisition id made w.r.t date of acqn
How reserves are part of capital?
Reserves are maintained from profit of current year business and profit is part of capital that's why reserves are also part of capital as if it is not maintained separately it will be included in profit or capital.
What should be Journal entry for creation of general reserve?
Reserves always created from profit. Therefore the Journal entry will be for creating reserves Dr Profit & Loss A/c CR Reserve A/c
Is revenue reserves the same as profit?
No, revenue reserves are not the same as profit. Revenue reserves refer to the portion of a company's profits that are retained within the business for future use, rather than distributed as dividends to shareholders. Profit, on the other hand, is the total income generated by a company after all expenses have been deducted. Essentially, profit can contribute to revenue reserves, but they represent different financial concepts.
Difference between provision and reserve?
Provisions are charge against profit and Reserves are appropriation of profit.
The amount of a fossil fuel that can be extracted at a profit using current technology is called a?
Fossil Fuel Reserves-Reserve-The amount of fossil fuel that can be extracted for profit•Methane Hydrates-New energy source found in the oceanANSWER: Reserves
What is the difference between retained earnings and reserve?
Retained earnings are current year profit and Reserves are allotted the amount from last year profits as reserves.
The amount of a fossil fuel that can be extracted at a profit using current technology is called?
The amount of a fossil fuel that can be extracted at a profit using current technology is called the economically recoverable reserves. These reserves represent the portion of a resource that can be extracted and sold at a profit, taking into account factors such as production costs and market conditions.
What is the difference between Reserves and Provision?
Reserve is a an amount set aside from the profit when it is calculated. On the other hand provision is an amount charged against profit and loss in order to assist in calculating the accurate profit.
What is the difference between profit and loss account and profit and loss appropiation account?
Profit and loss accont is used to calculate the profit or loss of business while profit and loss appropriation account is used to allocate or distribute net income or loss to share holders or different reserves account.
Is reserves similar or different from retained profit?
Reserves are similar in this sence that these are also created from net income and retained earnings are as well but the difference is that both are created and limited for different uses in business.
Can capital reserve be transferred to profit and loss account?
No, capital reserves cannot be transferred to the profit and loss account. Capital reserves are typically created from specific transactions, such as the revaluation of assets or the issuance of shares at a premium, and are intended for long-term use within the company. They are not available for distribution as dividends, unlike profits generated from normal business operations that flow into the profit and loss account.
What are the examples of revenue reserves?
Revenue reserve is created out of revenue Profit . It is created out of Revenue Profit for exaple General Reserve, Dividend equalization reserve, Investment fluctuation reserve etc.
