Question

Please give an example of the difference between a

Income statement

And

Balance sheet

Answer 1

Income Statement reports revenues and expenses i.e. how the company's business performance has been during the defined period, while the balance sheet reports assets, liabilities, and equity at a given point in time. The income statement provides a snapshot of company's business performance over a period of time, and the length of this period may vary. For example, annual statements will provide information for the complete year while quarterly statements cover three months. The selected time frame must be clearly indicated on any income statement. On the other hand, the balance sheet will provide information for the company's finances at one specific point in time. The balance sheet should be dated and values expressed on it must be accurate as of that date.