Accounting for IGCSE & O level - Preparation Of Financial Statements (Section 24 - No. 4)
What is the usual order when an income statement is prepared?
Revenue, COGS, Gross Profit, Operating Expenses, Profit
COGS, Revenue, Operating Expenses, Profit, Gross Profit
Gross Profit, Revenue, COGS, Operating Expenses, Profit
Revenue, Gross Profit, COGS, Operating Expenses, Profit
Explanation
The income statement is generally prepared by starting with revenues, deducting cost of goods sold to arrive at gross profit, then deducting operating expenses to arrive at profit.
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