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Exams (40 questions each), 52 Printable Crossword Puzzles, 175
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Income Statement
The income statement reports a company's income
or loss for a specific period.� It lists revenues and
subtracts from them the period's expenses. A positive balance
results in an income and a negative balance indicates a loss.�
In the example below revenues of $6,000 minus expenses of $3,000
results in a net income of $3,000. This figure is used on the
Statement of Owner's Equity.
Your Business
Name�
Income
Statement
For
Month Ended June 30, 20XX |
Revenues |
Net sales
|
|
$5,000.00
|
Rental revenue
|
� |
1,000.00
|
Total revenues |
� |
$6,000.00 |
Expenses |
Wages expense
|
$1,500.00 |
|
Cost of goods sold
|
1,000.00 |
|
Utilities expense
|
250.00 |
|
Supplies expense
|
�250.00 |
|
Total operating expenses
|
� |
3,000.00 |
Net
income/loss |
|
$3,000.00 |
 |
�
There are two formats commonly used to prepare income
statements - the single-step and multiple-step. The example above is a
single-step income statement. It consists of just two sections: revenues
and expenses. Expenses are deducted from revenues in a single-step to
find net income or loss.
In a multiple-step income statement, the results of
transactions are shown in sections separating operating activities from
non-operating activities. In addition, it classifies expenses by
function. For example, selling expenses are shown separate from
administrative expenses. If the company experienced extraordinary items
or discontinued a segment of operations, they are also shown in
different sections.
For professionally created examples of single- and
multiple-step income statements for corporations and sole
proprietorships, we recommend
The Master Set of 80 Business Forms. The set includes filled-in
forms designed to give you a complete understanding of how each form
works as well as blank forms for use in your own business or for
practicing income statement preparation.
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