Income Statement And Balance Sheet Are Same

Income statement and balance sheet differences.

Income statement and balance sheet are same. The balance sheet and income statement are both part of a suite of financial statements that tell the story of a business s history. Below you will find few points showing the difference between the income statement and balance sheet. An income statement shows revenues and expenses over a period of time. Income statement vs balance sheet.

An income statement also called a profit and loss account or p l. Conclusion both the balance sheet and income statement are two of the three most important financial documents of a business the other is the statement of cash flows. However the income statement uses revenues and expenses to generate a profit or loss figure. A balance sheet lists assets and liabilities of the organization as of a specific moment in time i e.

In financial accounting the balance sheet and income statement are the two most important types of financial statements others being cash flow statement and the statement of retained earnings. For example steam had a profitable year from the income statement and their assets outweigh their liabilities from the balance sheet which puts them in a strong financial position. The balance sheet is like a photo of your bank account and. For example the period may be a month a quarter or a year.

Income statement is one of the financial statements of the company which provides the summary of all the revenues and the expenses over the time period in order to ascertain the profit or loss of the company whereas balance sheet is one of the financial statements of the company which presents the shareholders equity liabilities and the. As of a certain date. The nature of a balance sheet is also static given it is a snapshot of a point in time whereas an income statement is dynamic and tracks the money s movement. They are important yet very different.

An income statement and a balance sheet are two significant financial statements in accounting and both statements have their own individual purpose and identity.