The income statement answers which of the following questions?
A) How much cash did the firm generate?
B) How profitable was the business?
C) How much money does the company owe?
D) How much money did the owners invest?

Question

Quizplus · Accepted Answer

The income statement shows the revenues, expenses, and net income (or net loss) of the business during a specific period, thus it answers the question of how profitable the business is. It does not provide information on cash generation, liabilities, or owner investments.

The Income Statement Answers Which of the Following Questions