Income Statements Flashcards
What can businesses do with financial statements?
Measure their success.
What is a financial statement?
A record of what the business is doing with its money.
What are the two types of financial statement?
Income statement and statement of financial position.
Do businesses have to keep financial statements by law?
Sometimes, they do. I don’t know where, though.
Where would you find net profit on an income statement, top or bottom?
Bottom.
Does a trading account measure gross or net profit?
Gross profit.
True or false: Gross profit is found at the bottom of the income statement.
False.
True or false: Financial statements help measure success.
True.
True or false: Income statements measure gross profit.
False. They measure net profit.
True or false: ‘Revenue’ is another word for ‘cost of sales’?
No. That’s stupid. Get out.
Where is net profit calculated in an income statement?
At the bottom of the income statement.
What is opening stock?
Stock left from the previous year.
