What Does An Income Statement Look Like In Accounting

It shows your revenue minus your expenses and losses.

What does an income statement look like in accounting. The income statement above shows five full calendar years plus a last twelve months ltm period as of 9 30 13. The income statement is one of a company s core financial statements that shows their profit and loss over a period of time. An income statement is a financial statement that shows you how profitable your business was over a given reporting period. But there s a lot more to be gleaned from it.

Here is an example of how to prepare an income statement from paul s adjusted trial balance in our earlier accounting cycle examples. 1 an income statement always represents a period of time like a month quarter or a year. But an income statement does much more than identify net income. Single step income statement.

It also provides a digestible way to understand the basic nature of the various revenues and expenses. Accounting how to understand an income statement at its most basic the income statement is a breakdown of revenue and expenses. As you can see this example income statement is a single step statement because it only lists expenses in one main category. The profit or loss is determined by taking all revenues and subtracting all expenses from both operating and non operating activities this statement is one of three statements used in both corporate finance including financial modeling and accounting.

In every income statement dozens hundreds thousands or even more individual transactions have been boiled down into a number of specific categories.