What does an income statement report?

An income statement, also known as a profit and loss statement, provides a summary of a company's revenues and expenses over a specific period, ultimately revealing the net income or loss for that period. This is crucial information for stakeholders, as it indicates how well the company is performing in terms of profitability.

By detailing revenues, which represent the total earnings from sales or services, and expenses, which include costs incurred in the process of generating those revenues, the income statement provides a clear picture of financial performance. The difference between these two figures results in net income, showing whether the company made money or experienced a loss during that period. This insight is fundamental for assessing operational efficiency and financial health.

The other options focus on different financial statements or measures. Specific asset values are typically reported on the balance sheet, cash inflows from financing activities appear in the statement of cash flows, and the overall financial position at a point in time is also a characteristic of the balance sheet. These distinctions underline the unique purpose of each financial statement in providing a comprehensive view of a company's financial situation.