Income Statement

The Income Statement, also called Statement of Financial Performance, presents the
financial results of a business for a given period of time. The statement presents the
amount of revenue generated and expenses incurred by the business during a reporting
period, as well as the resulting net income or net loss.

Revenues are increases in economic benefits during the accounting period in the form
of inflows or enhancements of assets or decreases of liabilities (or a combination of
both) from the delivery or production of goods, rendering of services, or other activities
that constitute the entity’s ongoing major or central operations.

Examples of revenues are as follows:

•    Sales
•    Professional fees earned
•    Service revenues
•    Interest revenue
•    Dividend revenue
•    Rent income
•    Subscription revenue

Expenses are decreases in economic benefits during the accounting period in the form
of outflows or using up of assets or incurrences of liabilities (or a combination of both)
from the delivery or production of goods, rendering of services, or other activities that
constitute the entity’s ongoing major or central operations.

Examples of expenses are as follows:

•    Cost of sales
•    Depreciation expense
•    Salaries and wages
•    Utility costs
•    Insurance expense
•    Permits, taxes and licenses
•    Repair and maintenance
•    Representation expenses
•    Losses