Statement of Activity (Income Statement)
The Statement of Activity, also called the Income Statement, lists the current totals for all income and expense accounts during a particular time period.
At year-end, the expense accounts are subtracted from the income accounts, which calculate the net profit/loss. The income and expense accounts are then reset to zero for the next year.
The Income Statement can have several columns. Usually, the current monthly totals are in the first column, the year-to-date totals in the second, budget amounts in the third and fourth, and last year's totals in the fifth and sixth columns. Additional columns can show the variance between years or the difference between the budget and current totals.
Accounting Equations and Terms
|Net Profit/Loss (on Income Statement)||= Total Income - Expenses|
|Assets||= Liabilities + Equity|