Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

1. Introduction to Accounting

The Financial Statements

Financial Accounting

1. Introduction to Accounting

The Financial Statements

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Multiple Choice

Which of the following items are included on an income statement?

Assets

Liabilities

Expenses

Revenues

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Verified step by step guidance

Step 1: Understand the purpose of an income statement. An income statement is a financial report that shows a company's financial performance over a specific period, focusing on revenues and expenses to calculate net income or loss.

Step 2: Identify the key components of an income statement. The primary items included are revenues (income earned from business operations) and expenses (costs incurred to generate revenues).

Step 3: Clarify why assets and liabilities are not included. Assets and liabilities are part of the balance sheet, which provides a snapshot of a company's financial position at a specific point in time, not its performance over a period.

Step 4: Relate revenues and expenses to the calculation of net income. Net income is calculated as:

Revenues - Expenses

. This is the key outcome of the income statement.

Step 5: Summarize the distinction. Revenues and expenses are included on the income statement because they reflect the company's operational performance, while assets and liabilities are excluded as they pertain to the balance sheet.