Example Of A Company Income Statement

It is more rep resentative of the type found in practice.

Example of a company income statement. The income statement format above is a basic one what is known as a single step income statement meaning just one category of income and one category of expenses and prepared specifically for a service business. This statement is a condensed version of the more detailed income statement presented in illustration 4 2. Would have the following heading. The purpose of these statements is to give information about the exact financial position of a company to people outside the company like creditors and.

It usually includes income statements cash flow statements owner s equity statement and a balance sheet. The profit or loss is determined by taking all revenues and subtracting all expenses from both operating and non operating activities this statement is one of three statements used in both corporate finance including financial modeling and accounting. The balance sheet and the income statement are two of the three major financial statements that. For example consider the income statement shown in illustration 4 3 for boc hong company.

Paul s guitar shop inc. The income statement is one of a company s core financial statements that shows their profit and loss over a period of time. For the year ended december 31 2015. Income statement provides a summary of all the revenues and the expenses over the time period in order to ascertain the profit or loss of the company and the example of which includes income statement prepared by a company xyz ltd.

This financial statement can also be used to track revenue and expenses to plan annual budgets and sales projections along with determining what areas of the business are over budget or under budget. Examples of service businesses are medical accounting or legal practices or a business that provides services such as plumbing cleaning consulting design etc. In addition the company takes depreciation expenses for its storefront building computer system and delivery van. Let us name the company strauss printing services all amounts are assumed and simplified for illustration purposes.

Businesses selling physical goods can use the income statement to track changes in returns cost of goods or operating expenses as a percentage of sales to quickly fix issues in the business. For example an annual income statement issued by paul s guitar shop inc. Illustration 4 2 income statement boc hong company income statement for the year ended. Financial statements refer to reports created by an organization s management to show financial performance at a particular point.

Here is a sample income statement of a service type sole proprietorship business. By examining a sample balance sheet and income statement small businesses can better understand the relationship between the two reports.