MGTA02H3 Chapter Notes - Chapter 9: Financial Statement, Income Statement, Gross Profit

• School: UTSC
• Department: Management
• Course: MGTA02H3
• Professor: Arif Toor

Document Summary

Income statement: the financial statement that shows how much revenue the business generated, and the cost incurred, in the course of making and selling products. Aka statement of profit and loss / statement of earnings . Purpose -> show how the business performed in the course of the prior year. Shows how much revenue the business generated, and the costs incurred by the business in the course of making and selling products. Shows information about the business" activities over a period of time. 4: profit (or loss): profit = 3903 in - 3903 out. Revenue growth: revenue/sales shows business doing something right. Revenue should increase year-to-year: growing revenue: more customers, spending more. To judge business" progress its revenues should be viewed in terms of a. 3-5-year trend: revenue should grow by at least the growth rate of national gdp. Revenues that doesn"t keep up with it means that the business is growing less quickly than the economy generally.