Income Statement
Accounting glossary · Understand, connect, apply
An income statement reports income and expenses for a period and shows the resulting profit or loss. It helps users understand financial performance.
Example
Revenue of $8,000 less expenses of $6,500 produces net income of $1,500 for the month.
Remember the difference
Profit is not the same as cash generated. Credit sales and depreciation can cause the two measures to differ.
Examples are simplified for learning. Where a term depends on US law, IFRS, US GAAP or a historical rule, check the context explained above and the requirements relevant to your course.
Study references: OpenStax financial accounting and managerial accounting. For reporting requirements, consult the applicable IFRS Standards or FASB guidance. US tax terms should be checked against the relevant tax-year IRS instructions.
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