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Sample Income Statement

Investing Lesson 4 - Analyzing an Income Statement

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The best way to learn to read an income statement is to begin by looking at a real world example. In this case, I'm going to take an old income statement from Microsoft because it is relatively simple, enough time has passed for us to look at the figures in retrospect, and you can look at it to get an idea of what an ordinary income statement looks like. You can see this sample at the bottom of this page. You may want to print it for reference as you work your through this lesson.

It's important to note that not all income statements look alike, although they necessarily contain much of the same information. As we work our way through various income statements, you will inevitably find they are much simpler and comparable than may appear at first glance.

Next page > Let's start walking through the income statement ... > Page 1, 2, 3, 4, 5, 6, 7, more >>

This page is part of Investing Lesson 4 - How to Read an Income Statement. To go back to the beginning, see the Table of Contents.

Sample Income Statement

Microsoft
Income Statement
Fiscal year200120001999
Total Revenue$28,365,000,000$$25,296,000,000$$22,956,000,000
Cost of Goods Revenue$5,191,000,000$3,455,000,000$3,002,000,000
Gross Profit$23,174,000,000$21,841,000,000$$19,954,000,000
Operating Expense
Research and Development$4,307,000,000$4,379,000,000$3,775,000,000
Selling, General, and Administrative Expenses$6,957,000,000$5,742,000,000$5,242,000,000
Non RecurringN/AN/AN/A
Other Operating ExpensesN/AN/AN/A
Operating Income
Operating Income$11,910,000,000$11,720,000,000$10,937,000,000
Total Other Income and Expenses Net($397,000,000)($195,000,000)$3,338,000,000
Earnings Before Interest and Taxes$11,513,000,000$11,525,000,000$14,275,000,000
Interest ExpenseN/AN/AN/A
Income Before Taxes$11,513,000,000$11,525,000,000$14,275,000,000
Income Tax Expense$3,684,000,000$3,804,000,000$4,854,000,000
Equity Earnings or Loss Unconsolidated SubsidiaryN/AN/AN/A
Minority InterestN/AN/AN/A
Net Income from Continuing Operations$7,829,000,000$7,721,000,000$9,421,000,000
Nonrecurring Events
Discontinued OperationsN/AN/AN/A
Extraordinary ItemsN/AN/AN/A
Effect of Accounting ChangesN/A($375,000,000)N/A
Other ItemsN/AN/AN/A
Net Income$7,829,000,000$7,346,000,000$9,421,000,000

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