alleryStart learning →The main purpose of an income statement is to show
AThe assets owned by the firm
BWhether a profit or a loss was made
CThe cash held at the year end
DThe balances of all ledgers
Answer & Solution
Correct answer: B. Whether a profit or a loss was made
It reports whether the business made a profit or a loss during the period.
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Related questions
Net income is also calledCharging depreciation on fixed assets has what effect on net profit?Rs 36,000 rent for 12 months is received on 1 January. At the 31 March year end, unearned Investment interest of Rs 12,000 a year is received for nine months only. Accrued income aMachine costing Rs 2,00,000 is bought on 1 October; depreciation 15% a year on cost, year Current assets are Rs 4,80,000 and current liabilities Rs 3,10,000. Net current assets arePurchases Rs 4,00,000, purchase returns Rs 25,000, carriage inwards Rs 5,000. Net cost of Gross sales Rs 6,40,000 and sales returns Rs 15,000. Net sales are