Single Step Income Statement
An income statement can be constructed in a number of different formats. The most simple and ready to make format is that of a single step income statement format. In the single step income statement a single and accumulated sub total of all the revenues is presented in one line where as the single and accumulated sub total of all the expenses in the businesses are presented in another line. The bottom of the income statement shows net loss or net profit of the business.
The sample format of a single step income statement can be shown as under
| Revenues | $1,000,000 |
| Total Revenues | $1,000,000 |
| Expenses | |
| Cost of goods sold | 350,000 |
| Advertising | 30,000 |
| Depreciation | 20,000 |
| Rent | 40,000 |
| Payroll Taxes | 28,000 |
| Salaries and Wages | 400,000 |
| Supplies | 32,000 |
| Travel and Entertainment | 50,000 |
| Total Expense | 950,000 |
| Net Income | 50,000 |
Single Step Income statement format is easy to make and manage however it is not widely used as it confuses the reader of the income statement to separately read and understand the subsets of the information within the income statement. For example in a single step income statement there is no calculation of contribution margin as well as expenses are not categorized according to departments.
Other Related Accounting Articles:
- Budgeted Income Statement
- How to prepare a Cash Flow Statement
- Statement of Retained Earnings
- Comparative Balance Sheet
- Purpose of Preparing Financial Statements
- Classified Balance Sheet
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