Which of the following is typically reported on the income statement?

• A. Owner's equity
• B. Cash balance
• C. Net income
• D. Total assets

Answer: (C)

Verified step by step guidance

1. Understand the purpose of the income statement: The income statement is a financial report that shows a company's financial performance over a specific period, primarily focusing on revenues, expenses, and resulting net income or loss.
2. Identify the components typically reported on the income statement: The income statement includes revenues, expenses, gains, losses, and the resulting net income or net loss. It does not include items like owner's equity, cash balance, or total assets, as these are reported on other financial statements.
3. Clarify the role of net income: Net income is the final result of the income statement, calculated as total revenues minus total expenses. It represents the company's profitability during the reporting period.
4. Distinguish between financial statements: Owner's equity is reported on the statement of owner's equity, cash balance is reported on the balance sheet, and total assets are also reported on the balance sheet. These items are not part of the income statement.
5. Conclude that net income is the correct answer: Based on the structure and purpose of the income statement, net income is the item that is typically reported on this financial statement.