Understanding the Income Statement - Deepstash
What Is Opportunity Cost

Learn more about corporateculture with this collection

The impact of opportunity cost on personal and professional life

Evaluating the benefits and drawbacks of different choices

Understanding the concept of opportunity cost

What Is Opportunity Cost

Discover 93 similar ideas in

It takes just

13 mins to read

Understanding the Income Statement

Understanding the Income Statement

An income statement is a financial statement that shows a company's revenue, expenses, and net income over a specific period of time. It can help you understand how much money your business is making and where that money is going. In our lemonade stand example, Ackman explains that the income statement shows that the business will sell 800 cups of lemonade for $1 each, but will need to spend $530 on staffing costs.


286 reads


Starting a Business: Incorporation

Starting a Business: Incorporation

To start a business, you'll need to choose a legal structure. One common option is incorporation. This means that you create a separate legal entity for your business. As Bill Ackman explains in our lemonade stand example, you'll need to file paperwork with your state and come up with a name for ...


524 reads

Understanding the Balance Sheet

Understanding the Balance Sheet

A balance sheet is a financial statement that shows a company's assets, liabilities, and equity at a specific point in time. It's important to understand the balance sheet to see how your business is doing financially. In our lemonade stand example, Ackman explains that the balance sheet shows th...


355 reads

Fixed Assets and Inventory

Fixed Assets and Inventory

Fixed assets are long-term assets that a business uses to generate revenue, such as buildings or equipment. Inventory refers to the products a business has on hand to sell to customers. In our lemonade stand example, Ackman explains that the business will need to buy a lemonade stand for $300 (a ...


307 reads

Return on Investment: Understanding Your Profit Margin

Return on Investment: Understanding Your Profit Margin

Return on investment (ROI) is a measure of how much money you've earned on your initial investment. It can help you understand your profit margin and make informed decisions about future investments. In our lemonade stand example, Ackman calculates that the business will have an ROI of 17% ($170 ...


305 reads

Profit and Loss: Calculating Net Income

Profit and Loss: Calculating Net Income

The bottom line on the income statement is net income, which is the amount of profit or loss a business has made over a specific period of time. In our lemonade stand example, Ackman calculates that the business will have a net income of $170 ($800 in revenue - $530 in expenses).


292 reads

Scaling Your Business: Using Your Profits to Grow

Scaling Your Business: Using Your Profits to Grow

Scaling your business is a challenging but rewarding process. By reinvesting your profits back into your business, you can fuel growth and take your business to the next level. Just remember to have a solid plan in place, manage your cash flow effectively, and stay true to your core values and mi...


302 reads

Raising Capital: Selling Stock and Borrowing Money

Raising Capital: Selling Stock and Borrowing Money

Once you've incorporated your business, you'll need to raise capital to get started. This can be done by selling stock or borrowing money. As Ackman explains, selling stock means that you're selling ownership in your company. In our lemonade stand example, Ackman sold 500 shares of stock for $1 e...


414 reads




Public Speaking, Coaching, Counseling, Mindfulness & Autogenic Training, Neuro-Linguistic Programming, Computer Engineering, Osteopathy, Traditional Chinese & Ayurvedic Medicine, Asian Languages and culture, Music & Art Therapy, Nada Yoga, Spiritualism

If you're new to finance and investing, you might feel overwhelmed by all the jargon and technical terms. However, understanding the basics can help you make informed decisions about your money. In this article, we'll explore the fundamentals of finance and investing using a simple example: a lemonade stand by William Ackman.

Related collections

More like this

Cracking the code of the Income Statement

It consists of three main categories:

  • Sales or revenue during a given time period. It includes sales (revenue) and Earnings-per-share (EPS)
  • Costs and expenses: “Above the line” are the cost of goods sold (COGS), cost of services (COS). “Below t...

Special Considerations

A common mistake companies make in their business model is that they often underestimate the costs of funding the business until it becomes profitable.

Many analysts believe that companies that run on the best business models can run themselves.

  • One way analys...

Understanding Business Models

  • The primary component of the business model is the value proposition. A value proposition is a description of the goods or services a company offers and why they are desirable to customers or clients.
  • A new enterprise's business model also covers p...


Explore the World’s

Best Ideas

200,000+ ideas on pretty much any topic. Created by the smartest people around & well-organized so you can explore at will.

An Idea for Everything

Explore the biggest library of insights. And we've infused it with powerful filtering tools so you can easily find what you need.

Knowledge Library

Powerful Saving & Organizational Tools

Save ideas for later reading, for personalized stashes, or for remembering it later.

# Personal Growth

Take Your Ideas


Organize your ideas & listen on the go. And with Pro, there are no limits.

Listen on the go

Just press play and we take care of the words.

Never worry about spotty connections

No Internet access? No problem. Within the mobile app, all your ideas are available, even when offline.

Get Organized with Stashes

Ideas for your next work project? Quotes that inspire you? Put them in the right place so you never lose them.


2 Million Stashers


5,740 Reviews

App Store


72,690 Reviews

Google Play


Don’t look further if you love learning new things. A refreshing concept that provides quick ideas for busy thought leaders.

Sean Green

Great interesting short snippets of informative articles. Highly recommended to anyone who loves information and lacks patience.

Shankul Varada

Best app ever! You heard it right. This app has helped me get back on my quest to get things done while equipping myself with knowledge everyday.

Ashley Anthony

This app is LOADED with RELEVANT, HELPFUL, AND EDUCATIONAL material. It is creatively intellectual, yet minimal enough to not overstimulate and create a learning block. I am exceptionally impressed with this app!

Laetitia Berton

I have only been using it for a few days now, but I have found answers to questions I had never consciously formulated, or to problems I face everyday at work or at home. I wish I had found this earlier, highly recommended!

Giovanna Scalzone

Brilliant. It feels fresh and encouraging. So many interesting pieces of information that are just enough to absorb and apply. So happy I found this.

Jamyson Haug

Great for quick bits of information and interesting ideas around whatever topics you are interested in. Visually, it looks great as well.

Ghazala Begum

Even five minutes a day will improve your thinking. I've come across new ideas and learnt to improve existing ways to become more motivated, confident and happier.

Read & Learn

20x Faster





Access to 200,000+ ideas

Access to the mobile app

Unlimited idea saving & library

Unlimited history

Unlimited listening to ideas

Downloading & offline access

Personalized recommendations

Supercharge your mind with one idea per day

Enter your email and spend 1 minute every day to learn something new.


I agree to receive email updates