The financial statement that reports whether the business earned a profit and also lists the revenues and expenses is called the:
A) Statement of cash flows.
B) Statement of financial position.
C) Balance sheet.
D) Income statement.
E) Statement of owner's equity.

Question

Quizplus · Accepted Answer

An income statement, also known as a profit and loss statement, reports a company's revenues and expenses to determine its profitability. It shows the net profit or loss for a specific period by subtracting expenses from revenues. Other financial statements like the balance sheet and statement of cash flows provide different insights into a company's financial position and cash flows.

The Financial Statement That Reports Whether the Business Earned a Profit