Income Statements

Question 1

What is an Income Statement?

Answer 1

Summary of company activity over a timeframe or period

Question 2

How does a corporation secure financing for projects?

Answer 2

Through investors

Question 3

A corporation invests in what to earn profit for investors.

Answer 3

Projects

Question 4

On an income statement what relates to how much product or service was sold?

Answer 4

Revenue and Sales

Question 5

what is CGS

Answer 5

Cost of Goods Sold

Question 6

CGS or Cost of Goods means what?

Answer 6

How much was spent in raw materials and other costs to produce the product

Question 7

What is Gross Profit?

Answer 7

Revenue minus CGS

Question 8

What is SGA?

Answer 8

Sales, General, Admin cost of running a business

Question 9

Is CGS or SGA directly related to creation of a product or service.

Answer 9

CGS

Question 10

Is CGS or SGA not related to creation of a product or service.

Answer 10

SGA

Question 11

EBITDA is what?

Answer 11

Earnings Before Interest, Tax, Depreciation and Amortization

Question 12

How do you calculate the EBITDA?

Answer 12

Gross Profit - SGA

Question 13

How to determine EBIT?

Answer 13

EBIDTA - Depreciation & Amortization (DA)

Question 14

What is Depreciation and Amortization?

Answer 14

Loss of value on property, plant and equipment

Question 15

How do you calculate Pre-Tax earnings?

Answer 15

EBIT - Interest Expense

Question 16

What is Profitability

Answer 16

Net Earnings = Pre-tax earnings - Tax

Question 17

What is money leftover after all processes called?

Answer 17

Retained Earnings

Question 18

What determines company stability?

Answer 18

If the company has enough capital to survive in 1 month - 1 year