Income Statement By Nature Vs Function

The company could has option to income statement either using nature or by function template.

Income statement by nature vs function. An income statement by nature method is the one in which expenses are disclosed according to their nature such as depreciation transports costs rent expense wages and salaries etc. Expenses in an income statement are either classified by their nature or by their function. Karel de grote hogeschool. The expenses in an income statement are either classified by their nature or by their function.

An income statement by nature is the one in which expenses are disclosed according to categories they are spent on such as raw materials transport costs staffing costs depreciation employee benefit etc. Income statement by function or by nature. Financial accounting 58429 academisch jaar.

The use of function method to disclose expenses still requires us to disclose the individual expenses by nature method under each function either on the face of the income statement or in the notes to the income statement. The following example shows the format of an income statement by function of expense. B2 h int us function nature statement income cost comprehensive income expenses by nature or by function 1083 0. Description and example of an income statement by function or by nature.