Wize University Managerial Accounting Textbook > Cost terms, concepts & classifications

The Income Statement

The Income Statement

What is an Income Statement?

Financial statement that shows revenues, expenses and profit for a given period.
In managerial accounting, the income statement typically shows a breakdown of how COGS is calculated.

Image illustrating The Income Statement

Example: Income Statement

Prepare the income statement using the following information, the company's tax rate is 30%

Sales: $500,000
Cost of goods manufactured: $250,000
Finished goods, January 1: $90,000
Finished goods, January 31: $50,000
Head office equipment depreciation: $12,000
Utilities expense for head office: $4,000
Sales commissions: $50,000

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Practice: Income Statement

Prepare the income statement for ABC Inc. for the month of March 2022 using the following information:

Illustration for practice question: Practice: Income Statement

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