This module covers the income statement and the statement of shareholders’ equity. Students first read chapter 3 of Understanding Financial Statements, ninth edition, by Lyn M. Fraser and Aileen Ormiston, then view the on-line presentation. Topics covered include: entries on the income statement; relevance of the income statement for creditors; subtotals on the income statement; why the entries on income statement are ordered in the way they are; and reconciling income statement figures to changes in equity. The module concludes with a problem assignment on the structure of the income statement.
Dr. Frederick C. Scherr is a Professor Emeritus of Finance at the College of Business and Economics at West Virginia University, where he taught for 30 years and won both the College’s Outstanding Teacher and Outstanding Researcher awards. He is the author of more than 30 research articles, four textbooks, and many articles in professional publications such as The Credit and Financial Management Review, The Credit Manager, and Business Credit. He has done extensive work in adult education for the National Association of Credit Management, including teaching at the Graduate School of Credit and Financial Management, and for private corporation