Business Administration 1220E Chapter Notes - Chapter 1: Income Statement, Gross Income, European Cooperation In Science And Technology

• School: Western University
• Department: Business Administration
• Course: Business Administration 1220E
• Professor: Barbara Bruce

Document Summary

Income statement (statement of earnings): shows how profitable a company was during a particular period of time (shows the activities over an entire operating cycle, so preferred for investors, normally a year) Basically, an income statement is a record of the revenue and expenses of a company during a specific time period. It is used to determine how profitable a company is during an operational cycle, and can be used to determine the effectiveness of manager techniques using the income operations section. This statement always begins with the company"s name, then the income statement title, then the time period (for the years ending . ). It always starts with the revenue, then expenses, then net income/loss. The main categories to know are the gross income, which is the margin the company earns after the cost of goods sold are subtracted from the net sales. This is calculated by subtracting the total operating expenses from the gross income.