Income Statement
Income statement is a description of the entities profitability over a period of time, usually quarterly or annually. The purpose of the income statement is to provide the financial earnings performance of the entity over a period of time. It is also referred as a earnings statement or profit and loss statement. It is one of three critical company financial statements for investor analysis.
Format of Income Statement
| Particulars | Amount | Particulars | Amount |
| To gross loss b/d
Administrative and Management Expense: Salaries and wages Office salaries Office rent, tax Establishment expenses Charity and donation Conveyance expenses License fees Office lighting Printing and stationary Telephone charge Postage Legal expenses Audit fees Insurance premium General expenses Director’s fees Electricity charges Telegram Employees benefits Entertainment benefits Entertainment expenses Bonus to staff Repairs and renewals Other office expenses Bank charges
Selling and distribution expenses: Salesman salaries Sales tax Travelling expenses Noting and pestering Packaging expenses Advertising and publicity Bad debts Selling commission Free sample Carriage and carriage outward Warehouse rent and insurance Delivery van expenses Packing expenses Sales promotion expenses Freight on sales Export duty Trade expenses Counting house salary Discount allowed Show room expenses
Other Expenses and Losses: Repairs and renewals Loss by fire or theft or accidents Loss on sale of assets Depreciation on fixed assets Intangible assets written off Preliminary expenses written off Discount on issue of shares Brokerage written off Underwriting commission written off Interest on loan Interest on capital Discount on bill Goodwill or trademark written off Miscellaneous expenses
To net profit c/d |
By gross profit b/d
By interest received By dividend received By discount received By commission received By rent received By discount from creditors By miscellaneous receipt By sales of scrap By bad debt recovered By old provision for bad debts By old provision for discount on debtors By shares transfer fees By apprentice premium By profit on sale of assets By sales of scrap By miscellaneous income By net loss c/d |
| Company’s Name
Income statement for the year ended…
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| Amount | |
| Sales
Less: Cost of goods sold Opening inventory Add: Purchases Less: Closing inventory Gross profit Less: Expenses
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| Net profit or loss | |
