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    What three questions can be answered by the income statement

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    Identify three questions that can be answered by reviewing a firm's income statement but that cannot be answered by reviewing the firm's balance sheet or statement of stockholders' equity. Be specific.

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    Solution Preview

    The details that are only revealed in an income statement include:

    1. The amount of total sales revenue, which also might include a comparison to the prior year if comparative income statements are presented.

    2. The total cost of goods sold and the contribution margin, assuming the company prepares a ...

    Solution Summary

    The solution provides more than three with an explanation that not all the financial statements follow the same format, and therefore may not contain all the same information.

    $2.19

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