What is another commonly used term for a profit-loss statement?

• A. Income statement
• B. Balance sheet
• C. Cash flow report
• D. Statement of changes in equity

Answer: (A)

The main idea here is terminology for a financial performance document. A profit-loss statement tracks revenues and expenses over a period to show net income or loss. The term most widely used for this report is the income statement, sometimes called the earnings statement. It’s the standard label you’ll see in financial reporting, and it emphasizes income over the period rather than a snapshot of financial position.

This distinguishes it from the balance sheet, which captures assets, liabilities, and equity at a single point in time; the cash flow report, which details cash receipts and payments; and the statement of changes in equity, which shows how owners’ equity changes over the period.