Multi Step Comparative Income Statement

It presents the revenue expenses and profit or loss generated by the business during a particular period but it uses a single equation to calculate profits.

Multi step comparative income statement. Based on the above comparative income statement of abc limited it can be analyzed how an increase in sales 25 over the previous year has impacted the net profit increased by 100 in absolute terms over the previous year and how various lines items have contributed. Let s take a look at a multi step income statement example. Comparative income statement format of abc limited for the period ended 2016 and 2017. Compute net income income from.

The most important of which are the gross profit and the operating profit figures. Compute income from operations gross profit operating expenses step 3. Multi step income statement involves more than one subtraction to arrive at net income and it provides more information than a single step income statement. Multi step income statement is divided into two main sections.

The operating section and the non operating. A single step income statement uses a single equation to compute the net income of the business and it is a more simplified report compared to a multi step income statement.