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Revenues and Expenses and The Income Statement

Since the purpose of accounting is to provide information for decision making, it is very important that we provide information about the profitability of the entity.  This is done using an Income statement. An income statement shows the Revenues of the business for the period being reported less the Expenses for that period.  Please review the following slide show on the proper format of the Income Statement.

Revenues:

Revenue is the amount of money charged for providing goods and services to customers in the normal course of business.

Expenses:

Expenses are the costs related to providing the goods and services to customers.

Please review the following slide show on Revenues and Expenses.

Please review the following slide show on how to record Revenues and Expenses in T-Accounts.