Snapshot of an Income Statement
By Jennifer Heebner, Senior Editor -- JCK-Jewelers Circular Keystone, 5/1/2005
Reviewing income statements comes easy for Eric Carstensen since he teaches at the GIA School of Business. During the recent JCK Show ~ Phoenix 2005, the professor quickly summarized the key points of an income statement in a seminar on understanding cash flow. Below is some of the info he shared with jewelers.
- Sales– Cost of Goods Sold = Gross Margin (or Gross Profit)
- Gross Margin – Operating Expenses = Operating Profit
- Operating Profit– Other Income – Other Expenses = Income Before Taxes (Interest Income/Expense, Gain/Loss on Disposal of Assets, Other Non-Operating Items)
- Income Before Taxes– Taxes = Net Income
(or Profit)
To reach Carstensen or for more information about the GIA School of Business, call (800) 421-7250 x4001, or visit www.gia.edu/education/24246/school_of_business.cfm.
