Income Statement

turquoise_cat
Mind Map by , created over 5 years ago

Masters Basic Accounting Mind Map on Income Statement, created by turquoise_cat on 02/06/2014.

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turquoise_cat
Created by turquoise_cat over 5 years ago
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1 Revenue
1.1 Gross Sales

Annotations:

  • Amount represents to amount of revenue generated by your business.
1.1.1 Less: Sales Returns/Allowances

Annotations:

  • Amount represents product returns and /or sales discounts.
1.1.1.1 Net Sales
2 Cost of Goods Sold
2.1 Purchases
2.1.1 Delivery Charges
2.1.1.1 Cost of Goods Sold

Annotations:

  • Amount represents costs directly associated with making or acquiring your products. 
3 Expenses

Annotations:

  • Daily expenses incurred in the operation of your business. The order in which your expenses are listed in the Profit and Loss Statement varies among businesses. One method is to list them in order of size, beginning with the larger items. Miscellaneous expense is usually shown as the last item, regardless of size.
3.1 Expense #1
3.1.1 Expense #2
3.1.1.1 Expense #3
3.1.1.1.1 Total Expenses

Annotations:

  • Sum of all expenses incurred in operating your business.
4 Other Income

Annotations:

  • Gain or loss on the sale of assets and/or interest income.
4.1 Income #2
4.1.1 Income #3
4.1.1.1 Total Other Income
5 Net Income (Loss)

Annotations:

  • The amount is basically the bottom line. If it is positive, you are in the “black” for the year. If it is negative, you are in the “red”. This is the profit or loss your business has made after all its income and all of its expenses have been taken into consideration.
5.1 Net Sales
5.1.1 Less: Cost of Goods Sold
5.1.1.1 Gross Sales Profit (Loss)

Annotations:

  • Amount is determined by subtracting the cost of goods sold from net sales. It does not include any operating expense or income taxes.
5.1.1.1.1 Less: Total Expenses
5.1.1.1.1.1 Net Operating Income

Annotations:

  • Represents the amount of income earned by your business before paying income taxes.
5.1.1.1.1.1.1 Plus: Total Other Income
5.1.1.1.2 Or Gross Margin
6 For Year Ending December 31, 20XX

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