Income Statement Best Definition

An income statement is a financial statement that shows you how profitable your business was over a given reporting period.

Income statement best definition. Income statement or otherwise called as statement of profit and loss is the summary prepared by the company s management reporting the revenues expenses gains and losses for the particular financial year simply put it portrays the final result of the company s operations over a period. The income statement contains several subtotals that can assist in. Bplans glossary also called profit and loss statement an income statement is a financial statement that shows sales cost of sales gross margin operating expenses and profits or losses. An income statement is one of the three along with balance sheet and statement of cash flows major financial statements that reports a company s financial performance over a specific accounting.

This is also known as the statement of financial performance because it tells whether the entity making losses or profits for the period. Also sometimes called a net income statement or a statement of earnings the income statement is one of the three most important financial statements in financial accounting. What is an income statement. The income statement also called a profit and loss statement is a report made by company management that shows the revenue expenses and net income or loss for a period.

The income statement is one of the main four financial statements that are issued by companies. The other parts of the financial statements are the balance sheet and statement of cash flows. Balance sheet income statement statement of owner s equity and statement. Read business terms glossary by.

The income statement is one of a company s core financial statements that shows their profit and loss over a period of time. What is an income statement. The purpose of the income statement is to show the reader how much profit or loss an organization generated during a reporting period this information is more valuable when income statements from several consecutive periods are grouped together so that trends in the different revenue and expense line items can be viewed. It shows your revenue minus your expenses and losses.

The profit or loss is determined by taking all revenues and subtracting all expenses from both operating and non operating activities this statement is one of three statements used in both corporate finance including financial modeling and accounting.