MBATricks

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Finance :: Income Statement

 

Like the Balance Sheet the Income Statement is one of the company official financial document. Also known as Profit and Loss Statement, this document indicates how Revenues (money received from the sales of products/services = Top Line) is transformed into Net Income (result after all revenues and expenses have been accounted for = Bottom Line). This document shows if the company made or lost money during the reported period.

 

Net Sales (Top Line)

– Costs of Good Sales (COGS)

—————————————————————————————————

= Gross Margin

– General, Sales, Administration (GSA – Overhead)

—————————————————————————————————

= Earnings Before Interests, Taxes, Depreciation and Amortization (EBITDA)

– Depreciation

– Amortization

—————————————————————————————————

= Earnings Before Interests and Taxes (EBIT)

– Interests

—————————————————————————————————

= Earnings Before Taxes (EBT)

– Taxes

—————————————————————————————————

= Earnings After Taxes (EAT – Bottom Line)

 

to summarize:

 

Net Sales

– COGS

—————————————————————————————————

= Gross Margin

-  GSA

—————————————————————————————————

= EBITDA

– D

– A

—————————————————————————————————

= EBIT

– I

—————————————————————————————————

= EBT

– T

—————————————————————————————————

= EAT

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