Accounts & Finance

An income statement is a financial statement that shows the income and expenses of a firm. It also displays if a company is profitable or losing money over a given time period. The income statement, together with the balance sheet and cash flow statement, aids in the understanding of your company's financial health. to prepare an income statement, you must first generate a trial balance report, then calculate revenue, determine cost of goods sold, calculate gross margin, include operating expenses, calculate income, include income taxes, calculate net income, and finally, finalize your income statement with business expenses.