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ACC 290 Preparing an Income Statement, Retained Earnings Statement, and Balance Sheet
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Income Statement

            “The purpose of the income statement is to show the reader how much profit or loss an organization generated during a reporting period” (Bragg, 2015). The income statement shows your monthly expenses, which in turn helps the business owner to set price points on services or products. It also helps investors see the viability of the business. Lenders use the income statement to make sure that the business is able to pay back any debts/loans. The top line (revenue) shows the money coming in from sales. The middle line (expenses) shows the expenses and the bottom line (net income) shows the difference between the two 

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