Chapter 33, Income Statements Flashcards
1
Q
Gross profit
A
revenue minus cots of sales
2
Q
Operating Profit
A
Gross profit minus expenses
3
Q
Profit for the year
A
Profit and dividends minus tax
4
Q
Contents of an Income Statement
A
- Revenue
- Costs of sales
- Gross profit
- Operating costs
- Profit before tax
- Profit for the year
- Non operating income/expenses
5
Q
Three sections of the income statement
A
- Trading account
- income statement
- appropriation account
6
Q
Uses of Income Statement
A
- helps with decision making
- allows comparisons to be made
- calculate ratios
- information for stakeholders
