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Finance

Retention Ratio Calculator

Calculate the portion of net income retained in the business to fund future growth rather than distributed as dividends.

Inputs

110,00,00,00,000
010,00,00,00,000

Calculation Results

Retention Ratio (Plowback)

70.00%

Retained Earnings

₹70,000

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Formula & Mathematical Explanation

Retention Ratio=(Net Income−Dividends PaidNet Income)×100\displaystyle \text{Retention Ratio} = \left( \frac{\text{Net Income} - \text{Dividends Paid}}{\text{Net Income}} \right) \times 100

The retention ratio (or plowback ratio) shows the percentage of net income that is retained to fund business expansion instead of being paid out as dividends. Retained earnings is the raw dollar amount of profits kept.

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