Income Statement Accounts
What are Income Statement Account?
Income statement accounts are those accounts in the general ledger that are used to form the income statement.
How it Works
During the accounting period, a business will update the accounts in its general ledger.
At period-end, the business uses this information to prepare two reports.
First, it prepares an income statement.
Then it prepares a balance sheet.
The information for the income statement comes from the income and expense accounts.
This is why the income and expense accounts are known as income statement accounts.
© R.J. Hickman 2020