To stay in business, your company needs to earn more than it spends, at least over the long term. A net income formula tells you whether you are earning or losing money. However, this equation only ...

A balance sheet provides a snapshot of a company's assets, liabilities and equity at a specific point in time, while an income statement summarizes its revenues and expenses over a period to show ...

A balance sheet displays what a company owns, what it owes, how it's financed, and its shareholders' equity at a particular point in time. An income statement displays the company's revenues and ...

Understanding how the income statement affects the balance sheet is not that difficult. The two concepts fit together like pieces of a dynamic puzzle. In this case, the puzzle is the financial ...

Investopedia contributors come from a range of backgrounds, and over 25 years there have been thousands of expert writers and editors who have contributed. Michael Boyle is an experienced financial ...

Will Kenton is an expert on the economy and investing laws and regulations. He previously held senior editorial roles at Investopedia and Kapitall Wire and holds a MA in Economics from The New School ...

In accounting, every financial transaction is recorded by two entries on the company's books. These two transactions are called a "debit" and a "credit," and together, they form the foundation of ...

A vertical analysis is used to show the relative sizes of the different accounts on a financial statement. For example, when a vertical analysis is done on an income statement, it will show the top ...

In accounting, every financial transaction is recorded by two entries on the company's books. These two transactions are called a "debit" and a "credit," and together, they form the foundation of ...

A vertical analysis is used to show the relative sizes of the different accounts on a financial statement. For example, when a vertical analysis is done on an income statement, it will show the top ...