Utah Contractor Practice Exam 2025 – All-In-One Guide to Master Your Contractor Exam Success!

The income statement is the financial statement that reports revenues and expenses over a specific time period, such as a month, quarter, or year. It provides a summary of the organization’s financial performance, showing how much money was made (revenues) and the costs incurred (expenses) during that period. This results in either a net profit or a net loss.

By focusing on the income statement, stakeholders can assess the operational efficiency of the business, evaluate its profitability, and make informed decisions based on its financial health. It's distinct from other financial statements in that it specifically hones in on operational results over time, rather than providing a snapshot of the company’s assets, liabilities, and equity as found in the balance sheet or detailing cash inflows and outflows as in the statement of cash flow.