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    The document discusses the key components of an income statement including revenue, costs of goods sold, gross profit, operating expenses, earnings before interest and taxes (EBIT), interest expense, income before taxes, income taxes, and net income. It explains that the income statement shows a company's revenues and expenses over a period of time, with the goal of determining profit or loss.

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    Fuertes

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    The document discusses the key components of an income statement including revenue, costs of goods sold, gross profit, operating expenses, earnings before interest and taxes (EBIT), interest expense, income before taxes, income taxes, and net income. It explains that the income statement shows a company's revenues and expenses over a period of time, with the goal of determining profit or loss.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    8 views1 page

    Los Fuertes

    Uploaded by

    leidy mercedes quintero castañeda
    The document discusses the key components of an income statement including revenue, costs of goods sold, gross profit, operating expenses, earnings before interest and taxes (EBIT), interest expense, income before taxes, income taxes, and net income. It explains that the income statement shows a company's revenues and expenses over a period of time, with the goal of determining profit or loss.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    of 1

    INCOME STATEMENT

    WHAT IS THE INCOME STATEMENT?


    THE INCOME STATEMENT IS ONE OF THREE CORE STATEMENTS BOTH IN
    FINANCIAL MODELLING AND ACCOUNTING.
    WHAT IS ITS USE IN
    FINANCIAL
    MODELING?

    HOW TO SET UP
    THE INCOME
    STATEMENT?

    This statement is a great


    place to begin the
    financial model, as it The income statement
    requires the least amount may have minor
    of information from the variations between
    balance sheet and cash different companies, as
    expenses and income will
    flow statement. be dependent on the type
    of operations or business
    conducted
    SALES
    REVENUE
    GROSS
    PROFIT

    The company’s revenue


    from sales or service is
    displayed at the very top Gross profit is found by
    of the statement. subtracting COGS from
    Sales Revenue.

    SG&A
    EXPENSES

    EBITDA

    The selling, general and


    administrative section will
    contain all other indirect
    While not present in all
    costs associated with
    income statements,
    running the business.
    Earnings before Interest,
    Tax, Depreciation and
    Amortization is found by

    EBIT
    subtracting

    INTEREST
    EXPENSE
    Similarly, while not
    present in all income
    statements, Earnings
    before Interest and Tax is
    found by subtracting
    It is common for
    depreciation and companies to split out
    amortization interest expense and
    interest income as a
    separate line item in the
    INCOME income statement.
    TAXES
    EBT OR PRETAX
    INCOME

    EILEEN ROJAS
    Income taxes refer to HASBLEIDY VASQUEZ
    relevant taxes to the pre- ANDRES VALENCIA
    tax income.
    Earnings before tax or MIGUEL MEDINA
    pretax income is
    calculated by subtracting
    interest expense from
    NET EBIT
    INCOME

    After deducting income


    taxes from pre-tax
    income, the remaining
    amount is the net income.
    This is the amount that
    flows into retained
    earnings,

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