Which of the following financial statements would be most useful if an analyst wants to know the profitability of a company?
A) income statement
B) balance sheet
C) statement of owner's equity
D) statement of cash flows

Question

Quizplus · Accepted Answer

The income statement provides information on a company’s revenues and expenses, allowing an analyst to calculate the net income or profitability. The balance sheet shows the financial position of a company at a specific point in time, the statement of owner’s equity shows changes in the company’s equity, and the statement of cash flows shows the changes in cash and cash equivalents over a period of time. While all financial statements provide important information, the income statement would be the most useful for evaluating profitability.

Which of the Following Financial Statements Would Be Most Useful