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Income Statement vs Balance Sheet

Posted by Sorge CPA Posted on June 20 2016

Income Statement

· Answers the Question: How much money you will make this year

· Most familiar to people

· Explains: income - expenses = bottom line

 

Balance Sheet

· Answers the Question: Where did the money go?

· More in depth understanding of expenses

· Explains: dollars going into things like debt, inventory, or supporting the clients lifestyle.