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HBS Online's plain explanation of what goes into an income statement and how accountants prepare one from the trial balance, with the ratios to read from it.
How to Read and Analyze an Income Statement
From online.hbs.edu by Harvard Business School Online Article
- An income statement covers a period; it summarises all income and expenses in it.
- It is prepared from the trial balance at the start and end of the period.
- Compare margins across periods, not just the bottom line.
