A firm's income statement reports the results from operating the business for a period of time,while the firm's balance sheet provides a snapshot of the firm's financial position at a specific point in time.

Question

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The income statement reflects the results of the company's operations over a certain period of time, usually a month, a quarter, or a year. In contrast, the balance sheet represents the company's financial position and resources at a specific moment. Therefore, the statement is a record of a firm's flows, while the balance sheet is a record of the firm's stocks.

A Firm's Income Statement Reports the Results from Operating the Business