Question

E

Which of the following best describes the information reported in the income statement?

Group of answer choices

The extent to which cash inflows exceed cash outflows.

The portion of profits paid in cash to stockholders.

The current resources available to pay current obligations.

The amount earned from customers compared to the cost of doing so.

Answer 1

In the income statement, revenue and expense of the current reporting period are recorded. The end product of income statement is the amount of profit earned or loss suffered.

Cash inflows and cash outflows are part of Statement of cash flows. These are not shown in Income statement. The portion of profits paid in cash to stockholders is dividend, which is a part of statement of retained earnings.

The amount earned from customer compared to the cost of doing so' best describes the information reported in the income statement.

Fourth option is the correct option.