“Bien entendu” is sometime used to say “properly understood” but it seems to me that it is not commonly used. You would rather ear “Bien compris”.

You would often ear “bien entendu” used as “properly understood” in films, like military / or aircraft stuffs. For example, a airplane pilote would say “Bien entendu” as an anwser to a radio order, like “Loud and clear” and “Roger that” in English.

The most commonly used meaning of “Bien entendu” is “Of course” however.

In this sentence, bien entendu means “of course”. This is an idiom in French. Synonyms include bien sûr and évidemment.

Like in English, bien entendu can mean either “this is obvious” or “this should be obvious”. Etymologically, I think it derives from “let this be understood between us” (entendre meant “understand” in classical French; this meaning has mostly died out to “hear” in modern French outside a few idioms).

In principle, bien entendu could be short for j’ai bien entendu, meaning “I heard you”. But it wouldn’t be used (unlike e.g. the similar construction bien compris), because it would be interpreted as the idiom meaning “of course”.