The income statement identifies the major sources of revenues generated by the firm and the corresponding expenses that were needed to generate those revenues.

Question

Quizplus · Accepted Answer

This is a correct definition of an income statement, which is also known as a profit and loss statement or statement of operations. It shows the financial performance of a business over a specific period of time by detailing its revenue, cost of goods sold, gross profit, operating expenses, net income or loss, and other relevant information.

The Income Statement Identifies the Major Sources of Revenues Generated