Why Income Statement Is Dated For A Period Of Time

It is one of the 3 key financial statements that reports the cash generated and spent during a specific time period.

Why income statement is dated for a period of time. 1 the income statement income statement the income statement is one of a company s core financial statements that shows their profit and loss over a period of time. The balance sheet summarizes financial information about your company at a point in time. The statement quantifies the amount of revenue generated and expenses incurred by an organization during a reporting period as well as any resulting net profit or loss the income statement is an essential part of the financial statements that an organization releases. If the accounting period of a company is for a 12 month period but ends on a date other than december 31 it is referred to as a fiscal year fiscal year fy a fiscal year fy is a 12 month or 52 week period of time used by governments and businesses for accounting purposes to formulate annual financial reports.

What are the three financial statements. A fiscal year fy does not. Would have the following heading. For example an annual income statement issued by paul s guitar shop inc.

The income statement is used to give a summary of the company s revenues and expenses over a specific period of time. All income statements have a heading that display s the company name title of the statement and the time period of the report. Elements of financial statements. This is also true of the statement of cash flow which is calculated by making certain adjustments to net income by adding or subtracting differences in revenue expenses and credit transactions.

For example the statement as of june 30 2011 indicates that the statement shows the financial status on that date. All the incomes and expenses over a certain period of time are incorporated in an income statement of a business. While a balance sheet relates to a specific date or a given point within an accounting cycle an income statement is concerned about a particular period or the time during an accounting cycle. Paul s guitar shop inc.

Revenue is credited and expenses are debited on a statement. This summary of the company s financial activities reflects the relationship between its assets and liabilities. The profit or loss is determined by taking all revenues and subtracting all expenses from both operating and non operating activities this statement is. What is the income statement.

The income statement is one the major financial statements used to analyze a company. The three financial statements are. The balance sheet is always dated till a certain period and values of elements on that date are accurate as of that particular period. While a balance sheet provides the snapshot of a company s financials as of a particular date the income statement reports income through a particular time period and its heading indicates the.