Financial statements show the financial performance of an organization. They are comprised of the Income Statement, the Cash Flow Statement, and the Balance Sheet, and are used both internally and externally by a variety of users. The Income Statement can also be referred to as profit and loss statement or statement of operations, and is one of the most important financial statements. It shows the profitability of a company during a specified accounting period.
This course aims to familiarize you with the Income Statement and give you an understanding of how it interacts with other financial statements. You'll be taken through the various components of the Income Statement and taught hands-on knowledge of how to calculate gross profit, operating income, and net income. Finally, the course presents how common business transactions affect the Income Statement and how it interacts with other financial statements.Learning Objectives
- Identify key characteristics of the Income Statement
- Recognize examples of revenues, gains, expenses, and loss-incurring activities
- Calculate gross profit, operating income, and net income
- Recognize how common transactions affect the Income Statement
- Identify how the income statement interacts with the other financial statements