income statements

What is an income statement

Another financial document that reports a company’s financial performance over a specific accounting period

It focuses on revenue, expenses, gains, and losses of a company during a particular period. It provides valuable insights into a companies operations

• shows in detail whether the business is profitable or not/ if the business made a profit or loss

What does an income statement include

Revenue, expenses and net income (add a line under to show that its important)

Revenue accounts

Typically represent how that company earns revenue, businesses usually only have one, if there are multiple accounts they will be listed in the first money column with revenue appearing in the second

Examples of revenue

Interest revenue, commissions revenue, sales revenue

Expense accounts

Each business may have multiple expense accounts, it will be descriptive of the type of expense (rent, delivery, bank, postage)

Who might need this information

Owners and managers, bankers (to be approved for a loan), income tax authorities (legal requirement along with tax returns)