For all companies, the Commercial Code does not prescribe any rules for the income statement except that it must include all income and expenses from the period (§ 242 sect. 2 and § 246 sect. 1). In particular, no minimum structure is required, but the GAAP must be applied.
For corporations there are more detailed rules:
–The income statement must be prepared in vertical format, i.e. all items are in lines: income is added, expenses are deducted; an account format is unacceptable (§ 275 sect. 1).200
–The income statement can be prepared according to either a total-cost format or cost-of-sales format (see below); the formats may not be mixed.
The two formats look as follows:201
Tab. 3.21: Formats for income statement.