Forman, Inc.earned $600,000 profit during 2016.On which financial statement(s) will you find the dollar amount of the profit earned by the company?

Question

Quizplus · Accepted Answer

The dollar amount of the profit earned by the company will be found on both the income statement and the statement of retained earnings. The income statement reports the company's revenues and expenses for a specific period, resulting in net income or net loss. The statement of retained earnings reconciles the net income from the income statement to the changes in the company's retained earnings account, which includes dividends and other adjustments. Therefore, both of these financial statements will reflect the company's profit earned during the year.