Income Statement Major Lines

In multiple step income statements tax is shown on.

Income statement major lines. Being able to project the main line items of the income. Tax or taxation is actually shown in a simplified way in that income statement as it is a single step income statement. Boc hong s in come statement includes all of the major items in the list above except for discontin ued operations. An income statement example period.

The income statement is one of the five types of financial statements that report and present an entity s financial transactions including revenues expenses net profit or loss for a specific period of time. Examples guide it becomes necessary to get into the habit of projecting income statement line items. An income statement prepared for the three months ended june 30 2017 covers the. For the year ended september 30 2016 means that the income statement covers the 12 month period starting from october 1 2015 through september 30 2016.

An income statement or profit and loss account also referred to as a profit and loss statement p l statement of profit or loss revenue statement statement of financial performance earnings statement statement of earnings operating statement or statement of operations is one of the financial statements of a company and shows the company s revenues and expenses during a particular period. This analysis is used to understand the cost structure of a business and its ability to earn a profit a proper analysis of the income statement requires that the following activities be addressed. The period for which an income statement is prepared can cover a month quarter or a year of operations. The income statement is one of a company s core financial statements that shows their profit and loss over a period of time.

Chapter 4 income statement and related information 4 3 illustration illustration 4 2 presents an income statement for boc hong company. In arriving at net income the statement presents the following subtotals. The analysis of the income statement involves comparing the different line items within a statement as well as following trend lines of individual line items over multiple periods. A major expense shown in our first income statement example above is tax.

The income statement comes in two forms multi step and single step. This is also known as the statement of financial performance because it tells whether the entity making losses or profits for the period. When building a three statement model 3 statement model a 3 statement model links the income statement balance sheet and cash flow statement into one dynamically connected financial model. In reality companies often use more complicated multiple step income statements where key expenses are separated into groups or categories.