The income statement, sometimes called the profit and loss statement, shows the firm’s sales and expenses, for the quarter or fiscal year, and for the year-ago period. Here are terms which typically appear on the income statement.
Revenues: The company’s total sales for the period. Sometimes another revenue figure is included showing sales unrelated to its main business.
Cost of sales: The direct material and labor costs of making or acquiring the products sold. Cost of sales often includes depreciation and amortization, but it doesn’t include marketing, R&D, or other indirect costs.
Gross profit: Revenues minus cost of sales.
Research and development: Costs of developing new products and services.
Sales and marketing: Often combined ...