The Income Statement is prepared from the balances of some of the General Ledger Accounts. The General Ledger Accounts are split between the Income Statement and the Balance Sheet. The Account types used by the Income Statement are Revenue, Costs and Expenses.
Income statement.
Income statement.
The Income Statement section of the work sheet is the information source used in preparing the income statement.
after income statement, before the balance sheet
Budgeted income statement is that income statement which is prepared before the actual income statement based on standard measurement and amounts in planning stage to foresee the future of business and which is used for controlling purpose as well.
Budgeted income statement is prepared at the last after preparing all other budgets and sales budget is the starting point of budgeting process.
Income Statement, Retained Earnings Statement, Statement of Equity, Balance Sheet, and then Statement of Cash Flows.
Income statement is prepared to find out the net profit or loss related to one fiscal year of business activities.
The Income Statement must be prepared first because the Current Profit or Loss (from the Income Statement) is needed in the Equity section of the Balance Sheet to make it balance. Also, the current profit or loss is the starting point to calculate Cash from Operations needed for the Cash Flow Statement.
Both statements are difference in this way that in merchandising income statement there is only one purchases items while in manufacturing income statement there is complete manufacturing account is also prepared to show manufacturing process as well.
When there is a parent child relation available then consolidated income statement is prepared in which expenses and income of parent and subsidiary are shown in one single financial statement due to which net profit or loss for whole organization is shown.
Income statement of manufacturing organization is same as for trading company with little difference in manufacturing company there is separate manufacturing account is also prepared.