The income statement indicates a business's success or failure in earning an income from its operating activities,but it does not reflect the inflow and outflow of cash from operating activities.

Question

Quizplus · Accepted Answer

The income statement measures a company's financial performance over a specific period, focusing on revenues and expenses to determine net income or loss. It does not directly show cash inflows and outflows; that information is provided by the cash flow statement.

The Income Statement Indicates a Business's Success or Failure in Earning