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.
41
291 reads
CURATED FROM
IDEAS CURATED BY
🔹Wellness 🔹Empowerment 🔹Life Coaching 🔹Learning 🔹Networking 🔹Counseling 🔹Evolution 🔹Transformation
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.
“
The idea is part of this collection:
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
Related collections
Similar ideas to Understanding the Income Statement
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...
Read & Learn
20x Faster
without
deepstash
with
deepstash
with
deepstash
Personalized microlearning
—
100+ Learning Journeys
—
Access to 200,000+ ideas
—
Access to the mobile app
—
Unlimited idea saving
—
—
Unlimited history
—
—
Unlimited listening to ideas
—
—
Downloading & offline access
—
—
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