real income

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on line income is one of the financial statements of a company and shows the company’s during a particular period.1 It indicates how the revenues (money received from the sale of products and services before expenses are taken out, also known as the “top line”) are transformed into the net income (the result after all revenues and expenses have been accounted for, also known as “net profit” or the “bottom line”). The purpose of the income statement is to show managers and investors whether the company made or lost money during the period being reported. One important thing to remember is that it represents a period of time like the cash flow statement. This contrasts with the balance sheet, which represents a single moment in time. Charitable organizations that are required to publish financial statements do not produce an income statement. Instead, they produce a similar statement that reflects funding sources compared against program expenses, administrative costs, and other operating commitments. This statement is commonly referred to as the statement of activities.3 Revenues and expenses are further categorized in the statement of activities by the donor restrictions on the funds received and expended. 13188



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