Procter & Gamble just released its latest income statement. What is th

QUESTION

Procter & Gamble just released its latest income statement. What is the statement most likely to be used for?

A) determining what P&G is worth
B) determining whether P&G is profitable
C) determining P&G’s tax liability
D) determining P&G’s owners’ equity
E) determining whether P&G should sell assets

ANSWER

Answer: B
Explanation: B) The income statement compares sales and expenses for a particular time to tell whether the firm has been profitable.