Any time dividends are paid to stock holders, it might have an effect on a company's retained earnings.
Retained profits are a portion of the firm's net earnings that are left over after paying dividends to shareholders, as opposed to common stock, which represents the ownership of the company by equity shareholders.
Common stocks are listed on the balance sheet as the total number of a company's shares. The company's owners are its common stockholders, who also have voting rights and are entitled to dividends. They could be outside investors, insiders, or firm promoters.
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