Income Statement

You report revenues and the expenses of an accounting period in a financial statement called the income statement, also called a profit and loss statement or operating statement. Since revenues and expenses are increases and decreases in equity, the income statement explains changes in one item, retained earnings, on the balance sheet

The profit/loss represents the change in retained earnings.

There is no standard format for an income statement and it varies from country to country. Artemis Accounts includes some basic formats that you can use as is, or export to a word processor to produce the statement best suited to your own needs. In this format, the various items of revenue are shown first, the total revenue is calculated, and the expenses are subtracted. The difference between revenues and expenses is income. Because it is at the bottom of the statement, the income amount is often referred to as the bottom line.

Note that in some countries, expenses are listed before revenue.