Retained earnings are defined as negative retained earnings on the balance sheet.

Balance sheet items that record under equity sections are retained earnings.The cumulative net income is recorded in this account.If the entity operation produces net income, then retained earnings are.Total equity is decreasing when retained earnings turn into negative.If the equity turns to the level that is below the requirement, shareholders or owners are usually required to inject more funds.There are many factors that we can take into account.For example, the age of the entity, nature of industry that entity operates in, and other internal factors can affect an entity's profits or losses.

Retained earnings will turn to negative if the entity operation makes operating losses.Total equity is decreasing when retained earnings turn into negative.If the equity turns to the level that is below the requirement, shareholders or owners are usually required to inject more funds.There are many factors that we can take into account.For example, the age of the entity, nature of industry that entity operates in, and other internal factors can affect an entity's profits or losses.

Total equity is decreasing when retained earnings turn into negative.If the equity turns to the level that is below the requirement, shareholders or owners are usually required to inject more funds.There are many factors that we can take into account.For example, the age of the entity, nature of industry that entity operates in, and other internal factors can affect an entity's profits or losses.

Potential investors might be concerned about negative return earnings being a positive sign.There are many factors that we can take into account.For example, the age of the entity, nature of industry that entity operates in, and other internal factors can affect an entity's profits or losses.

Many factors can be looked into in detail.For example, the age of the entity, nature of industry that entity operates in, and other internal factors can affect an entity's profits or losses.

If an entity just starts operating, it won't make profits and most likely make losses, but it will turn into operating profits when the operation runs smoothly, the brand name is well known and sales increase.

When the entity operation runs smoothly, the brand name is well known and sales increase, it will turn into operating profits.