Chapter 4, Problem 4.6EX

To determine

Financial statement

A financial statement is the complete record of financial transactions that take place in a company at a particular point of time. It provides important financial information like assets, liabilities, revenues and expenses of the company to its internal and external users. It helps them to know the exact financial position of the company. There are four basic financial statements; they are:

• Balance Sheet

• Income statement

• Statement of owners’ equity

• Statement of cash flows

Income statement: The financial statement which, reports revenues and expenses from business operations and the result of those operations as net income or net loss for a particular period is referred to as income statement.

To Prepare: An income statement for the year ended February 29, 2016.