The income statement is intended to inform the reader of:

A) the overall financial condition of the firm at a point in time.
B) how much the firm has earned during an accounting period.
C) how much income has been distributed to shareholders.
D) the cash flow generated by the firm over a period of time.

Accounting Period

A specific time period at the end of which an organization prepares financial statements.

Income Statement

A financial statement that shows a company’s revenues and expenses over a specific period, illustrating how the revenues are transformed into net income or loss.

Financial Condition

A snapshot of a company's financial health, encompassing assets, liabilities, equity, and liquidity at a specific point in time.