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What is an Income Statement?
An income statement is a business’s financial statement that gives the income results from operations and non-operations activity. It is also called a profit and loss statement or a statement of operations.
It is one of the major financial statements in the world of corporate accounting. The others are the balance sheet, the statement of cash flows, and the statement of shareholder’s equity. The income statement will included revenues and gains from investments and “secondary operations”, but it will not include cash flows in or out which may stem from other accounting periods.
The cash flows will appear on the statement of cash flows. The income statement will show all major activity for the period in question, which could be a month, quarter, year, or other period. After adding in the sources of revenue for the period and subtracting the expenses and losses, the bottom line of the income statement is known as the net income, or earnings.
This is the reason profit and loss are sometimes called the “bottom line.”
What is Profit and Loss (P&L) Statement?
What is a Cash Flow Statement?
What is a Sole Proprietorship?
Sole proprietorships are businesses owned by a single person. The owner assumes all legal and financial responsibility
What is a Matching Contribution?
Employers can contribute to an employee’s 401(k) on a matching basis. Some employers will make additional contributions
Can Something Happen to My Defined Benefit Plan?
The Pension Benefit Guaranty Corporation will insure benefits up to a point, but it may not replace the full value
What are some examples of Investment Instruments I can use?
There is a wide variety of investments available for every kind of investor: Stocks, bonds, Mutual Funds, ETFs, and so on
What is an asset mix?
An asset mix is the blend of major asset classes in a portfolio, which should be constructed based on the risk tolerance
What is an Adjunct Account?
An adjunct account increases the valuation of a liability account. It is commonly used for a bond issue sold at a premium
What is Accidental Death and Dismemberment Insurance?
Accidental Death and Dismemberment (AD&D) coverage is normally offered as a rider on health or regular life insurance
What is Times Interest Earned (TIE)?
Times Interest Earned is analysis that compares the pre-tax earnings of a company to the total amount of interest payable
What is Time Value of Money?
The Time Value of Money is a theme for discourse and calculations related to the effect of interest on money over time
What are the Vesting Rules for my SEP IRA?
SEPs are funded entirely by employer contributions, and these contributions are immediately vested for the employee