The Income Statement

3. a profitability measure that indicates how well a business generates profits from the total assets that it owns
5. a profitability measure that determines how effectively a business uses its capital investments to generate profit
7. calculation that indicates the ability of a business to use its assets to produce revenue
9. a profitability measure that indicates the ability of a business to turn the owner’s investments and reinvested earnings into additional profit or earnings
10. a method of accounting in which revenue and expenses are recorded only at the time that cash is exchanged
13. a percentage that reflects the profitability of the core operations of a business
17. income that is generated by a business when no cash has been received
18. income or a return on an investment
20. a profitability measure that determines the percentage of a business’s revenue that exceeds its cost of goods sold
21. money that is paid for goods or services

1. expense for which there is no associated cash outflow in the current accounting period
2. a method of accounting in which income and expenses are recorded at the time that they are incurred, regardless of when cash is exchanged
4. ratio that measures the ability of a business to generate returns to its owner(s)
6. a calculation that indicates how efficiently an income-producing property is being managed
8. the amount of revenue that remains after all expenses have been deducted from a business’s total revenue
11. cost directly related to the production of a good or a service that is offered for sale
12. income that involves the receipt of cash by a business
14. a measure of a business’s profit after all operating expenses have been deducted
15. a record of all revenues and expenses that determine the net income or the net profit of a business over a specified period
16. a ratio that measures the efficiency of a business and its ability to convert sales into profits
19. the difference between the net sales revenue and the cost of goods sold