Sample Income Statement Analysis

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An income statement is a financial statement that shows sales, cost of sales, gross margin, operating expenses, and profits or losses. Gross margin is sales less cost of sales, and profit (or loss) is gross margin less operating expenses and taxes.

Sample Income Statement Analysis

	[ABC Company]		Income Statement
	For the Years Ending [Dec 31, 2008 and Dec 31, 2007]

	Revenue		2008	2007
		Sales revenue	110,000	95,000
		(Less sales returns and allowances)
		Service revenue	70,000	62,000
		Interest revenue
		Other revenue
	Total Revenues		180,000	157,000
				[42]
[42]	Expenses
		Advertising	1,000	1,000
		Bad debt
		Commissions
		Cost of goods sold	65,000	63,000
		Depreciation
		Employee benefits
		Furniture and equipment		8,000
		Insurance
		Interest expense	4,200	5,200
		Maintenance and repairs
		Office supplies
		Payroll taxes
		Rent
		Research and development
		Salaries and wages	55,000	55,000
		Software
		Travel
		Utilities
		Web hosting and domains
		Other	17,460
	Total Expenses		142,660	132,200

		Net Income Before Taxes	37,340	24,800
		Income tax expense	14,936	9,920

	Income from Continuing Operations		22,404	14,880
		[42]
[42]	Below-the-Line Items
		Income from discontinued operations
		Effect of accounting changes
		Extraordinary items

	Net Income		22,404	14,880

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