Question

What are the components in Cheyenne Corp's income statement?

1) Revenue, Expenses, Net Income
2) Assets, Liabilities, Equity
3) Gross Profit, Operating Income, Net Income
4) Cash Flow from Operations, Cash Flow from Investing, Cash Flow from Financing

Answer 1

The components of Cheyenne Corp's income statement are Revenue, Expenses, and Net Income. Revenue is the income generated from business operations, and after subtracting all expenses, the remaining amount is Net Income.

Step-by-step explanation:

The components in Cheyenne Corp's income statement are: Revenue, Expenses, and Net Income. An income statement portrays a company's financial performance over a specific accounting period. This statement shows how revenue (sales and other income) is transformed into net income (the result after all expenditures, expenses, and taxes). It begins with the top line, revenue or sales, and after deducting various expenses, concludes with the bottom line, known as net income or profit or loss. Unlike the options that mention Assets, Liabilities, Equity, those are components of a balance sheet, and the Cash Flow from Operations, Investing, and Financing are parts of the cash flow statement, not the income statement.