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User:Jukeboksi/BBA studies/Accounting
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== Income statement or profit and loss statement == :* '''[[w:Income statement]]''' (also referred to as '''profit and loss statement (P&L)''', '''revenue statement''', '''statement of financial performance''', '''earnings statement''', '''operating statement''' or '''statement of operations)'''is a company's '''[[w:financial statement]]''' that indicates how the revenue (money received from the sale of products and services before expenses are taken out, also known as the "top line") is transformed into the net income (the result after all revenues and expenses have been accounted for, also known as Net Profit or the "bottom line"). ( Wikipedia ) ::<tt>Mnemonic:</tt> ''"The [[w:income statement]] describes the income possibilities of the [[w:entrepreneur]] with 100% of shares <u>not</u> the income of the business, that's called the [[w:top line]] and is only small part of the whole thing."'' ::An '''''[[w:income statement]]''''' (also referred to as '''''profit and loss statement (P&L)''''', '''''revenue statement''''', '''''statement of financial performance''''', '''''earnings statement''''', '''''operating statement''''' or '''''statement of operations''''') is a company's [[w:financial statement]] that indicates how the [[w:revenue]] (money received from the sale of products and services before expenses are taken out, also known as the "top line") is transformed into the [[w:net income]] (the result after all revenues and expenses have been accounted for, also known as Net Profit or the "bottom line"). It displays the revenues recognized for a specific period, and the [[w:cost]] and [[w:expense]]s charged against these revenues, including [[w:write-off]]s (e.g., [[w:depreciation]] and [[w:amortization]] of various [[w:asset]]s) and [[w:tax]]es. The purpose of the income statement is to show [[w:Management|managers]] and [[w:investor]]s whether the company made or lost money during the period being reported. ( Wikipedia ) <tt>Formula for income statement</tt> :: <tt> incoming </tt> '''[[w:revenue]]''' == '''[[w:top line]]''' == '''[[w:turnover]]''' == '''[[w:income]]''' == '''[[w:cash flow]]''' :: <tt> minus outgoing </tt> '''[[w:expenses]]''' :: <tt> equals </tt> '''[[w:net income]]''' == '''The [[w:bottom line]]''' == '''[[w:net profit]]''' == [[w:net earnings]]''' :an example of an income statement for a really small business involved in international trade :::''''+ [[w:Revenue]]''' :::'''- [[w:Fixed costs]]''' ( ::::- [[w:Personel]] costs ::::- [[w:Facilities]], [[w:office]] and [[w:bookkeeping]] and [[w:accounting]] [[w:cost]]s ) :::'''- [[w:Variable costs]]''' ( ::::- [[w:Unit price]] x lot size + [[w:VAT]] ::::- [[w:Duty (economics)|Duties]] and [[w:tariffs]] or in case of [[w:single-market]] or [[w:free trade area]] no need ::::- [[w:Logistics]] and [[w:warehousing]] ::::- [[w:distribution]] costs ::: ) :::________________________________ :::== '''[[w:Net income]]'''
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