Accounting / August 3, 2018 / Khloe Santiago
This can be calculated as total sales (income) less the costs (expenses) directly related to those sales. Raw materials, manufacturing expenses, labor costs, marketing, and transportation of goods are all included in expenses.
Along with three other reports relating to the financial health of your small business, the balance sheet is essential information that gives a "snapshot" of the company’s net worth at any given time. The report is a summary of the business assets and liabilities.
If at any point you decide to pursue financing for your business in the form of a business loan or by working with an investor, you might find yourself faced with an entirely new learning curve of terminology and principles. You’ll need to understand them so that you can make the best funding choice for your business.
In the context of corporate financial reporting, the income statement summarizes a company's revenues (sales) and expenses, quarterly and annually for its fiscal year. The final net figure, as well as various other numbers in the statement, are of major interest to the investment community.
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