Net income in the income statement is the same amount as taxable income reported to the Internal Revenue Service (IRS).

Question

Quizplus · Accepted Answer

Net income in the income statement is calculated based on Generally Accepted Accounting Principles (GAAP) which differ from the rules and regulations set by the IRS for taxable income. Thus, there are various adjustments made to reconcile net income with taxable income, resulting in differences between the two.

Net Income in the Income Statement Is the Same Amount