You would expect to find the account "consulting revenue" in which of the following places in the financial statements?
A) In the balance sheet
B) In the income statement
C) In the statement of changes in shareholders' equity
D) In a cash flow statement prepared using the indirect method

Question

Quizplus · Accepted Answer

Consulting revenue is a type of revenue that a company earns from its primary operations, therefore it would be found in the income statement. The balance sheet only shows assets, liabilities, and equity at a specific point in time. The statement of changes in shareholders' equity shows how equity has changed over a period of time due to transactions such as issuing new shares and paying dividends. A cash flow statement prepared using the indirect method starts with net income, which includes consulting revenue, but does not specifically identify consulting revenue as a separate line item.

You Would Expect to Find the Account "Consulting Revenue" in Which