Multi-Step Income Statement Vocabulary

Vocabulary flashcards covering key terms and line items from a Multi-step Income Statement.

Net sales

Sales revenues minus sales return and allowances and sales discounts.

Cost of goods available for sales

Opening stock plus purchases, less purchase return and discount on purchase, plus carriage inwards.

Cost of goods sold

Cost of goods available for sales minus closing stock.

Gross profit/Loss

Net sales minus the cost of goods sold.

General and administrative expenses

Operating expenses consisting of items such as depreciation on buildings and office furniture, amortization of trademark and other intangibles, salaries and wages of office staffs, insurance expense, supplies expense, office rent, printing and stationery, depreciation on store furniture and fixtures, and other office related expenses.

Selling and distribution expenses

Operating expenses consisting of advertising, salaries and wages of sales people, rent of warehouse and showrooms, salesperson's commission, depreciation on delivery vans and automobiles, and other selling and distribution expenses.

Income from operations

Gross profit minus total operating expenses (general and administrative expenses plus selling and distribution expenses).

Other revenues and gains

Non-operating revenue items including interest revenue (received), dividend received, rent and commission revenues, and gain on disposal of assets.

Other expenses and losses

Non-operating expense items including interest expense (paid) and loss on disposal of assets.

Income before taxes

Income from operations plus the excess of revenues and gains over expenses and losses (or less the excess of expenses and losses over revenues and gains).

Net income/ Loss

Income before taxes minus income tax expenses/provision for tax.