From the course: Financial Accounting Foundations
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The income statement
- The income statement contains two items, revenues and expenses. Revenues minus expenses equals net income. Now the income statement is constructed using a very careful sequencing of the reported revenues and expenses to highlight important profit measures. Let's look at the actual income statement for Walmart for the years ended January 31, 2019, 2018, and 2017. Typically, when a company presents an income statement, the company reports information for three years so that the financial statement user can spot trends. And when you look at an income statement, you should look at two numbers first. The top one, sales, and the bottom one, net income. The top number here, sales, is the total amount that Walmart sold to you and me and other people around the world during the year, $510 billion. By the way, that's the world record. No company in the history of the world has ever sold more than that in one year. By comparison…
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