Income Statement - How is an income statement used?

Q: How is an income statement used?

What are income statements used for? You use an income statement to track revenues and expenses so that you can determine the operating performance of your business over a period of time. ... Income statements can also track dramatic increases in product returns or cost of goods sold as a percentage of sales.

Answer

For what purposes are income statements prepared? You may learn a lot about your company's operational effectiveness over time by looking at its income statement, which details all of the money coming in and going out. A company's income statement might reveal sharp spikes in product returns or COGS as a proportion of sales.

Income Statement - How is an income statement used?

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