Earned Capital

Earned Capital is the value of the assets accumulated through the profitable operation of a company. Earned capital is different than the related concept of paid in capital. The source of earned capital for a company is net income.  If there is sufficient net income after paying dividends, the company may decide to keep earned capital in the form of retained earnings.

Earned capital is credited to retained earnings, and can be found in the owner's equity portion of the balance sheet.