Compensated Awareness Post View
Disclaimer
Understanding The Income Statement
The income statement is one of the three financial statements - the other two are the balance sheet and cash flow statement - with which stock investors need to become familiar. The purpose of this article is to provide the less-experienced investor with an understanding of the components of the income statement in order to simplify investment analysis and make it easier to apply it to your own investment decisions.
In the context of corporate financial reporting, the income statement summarizes a companys revenues (sales) and expenses quarterly and annually for its fiscal year. The final net figure, as well as various others in this statement, are of major interest to the investment community. (To learn more about reading financial statements, see What You Need To Know About Financial Statements, Footnotes: Start Reading The Fine Print and Introduction To Fundamental Analysis.)
General Terminology and Format Clarifications
Income statements come with various monikers. The most commonly used are statement of income, statement of earnings, statement of operations and statement of operating results. Many professionals still use the term P
