Understanding the Income Statement: Profit, Revenue, and Expenses

Shemael Hamilton ACC111 A financial summary's income statement provides information about Profit or loss of the entity is shown on the income statement, which is a period statement because it includes revenue and all expenditures for the given time period. A service business' income statement is produced differently from one for a company that sells goods. There is a distinction between inventory and services businesses in that merchandisers buy and sell inventory, whereas services businesses only market their services. Because of this, opening inventory and closing inventory, which are linked to the balance sheet, are shown in the merchandiser company's income statement. In contrast, only revenue from the sale of services, operating expenses, and non-operating expenses are listed in the income statement of a services company.