1. THE STATEMENT OF INCOME
CHAPTER 10
THE STATEMENT OF INCOME

2. Outline Statement of Income Single Step Format Multiple Step Format
The Uniform System of Accounts for the Lodging Industry (USAL) 9th Revised Edition
Special Income Statement Items
Comprehensive Income
Illustrative Income Statement

3. Includes revenue, expenses & resulting net income
STATEMENT OF INCOME
Reflects results of operations of a company for a period of time
It might include special items such as gain or loss on sale of property or extraordinary items
Includes revenue, expenses & resulting net income

4. SINGLE STEP FORMAT
Arrives at net
income in one
step

5. MULTIPLE STEP FORMAT Arrives at net income in many steps
Provides additional information for managerial purposes
USAL is an example of a multiple step income statement

6. The Uniform System of Accounts for the Lodging Industry (USAL)
OPERATED DEPARTMENTS
UNDISTRIBUTED OPERATING EXPENSES
FIXED CHARGES
SECTION I
SECTION II
SECTION III

7. USAL-9TH REVISED EDITION
SECTION I
OPERATED DEPTS
Revenue and expenses
allocated to
revenue producing
departments

8. USAL-9TH REVISED EDITION
UNDISTRIBUTED
OPERATING
EXPENSES
INCURRED FOR
THE BENEFIT OF THE
OVERALL BUSINESS
SECTION II

9. USAL-9TH REVISED EDITION
SECTION III
FIXED CHARGES
NOT UNDER THE
CONTROL OF
OPERATIONS MGT
RENT, INTEREST
DEPRECIATION
PROPERTY TAX

10. Special Income Statement Items
Extraordinary Items
Gains and losses of an unusual and nonrecurring nature
Discontinued Operations
Gains and losses from the disposal of a business
Cumulative effect of a change in accounting
principle
The effect of the change is reported in a separate section of the income statement and disclosed in footnotes

11. Comprehensive Income
Change in equity from transactions and other events resulting from non-owner sources
One Statement Approach
The Two-Statement Approach
The Statement of Changes in Equity Approach

12. Illustrative Income Statement
Revenue
Rooms $1, $1, $1,400
Food and Beverage
Other
$2, $2, $2,530
Expenses
Rooms $ $ $460
Food and Beverage
Other Expenses
1, , ,710
Income before Income Taxes
and Extraordinary item
Provision for Income Taxes
Income before Extraordinary Item
Extraordinary Loss (20)
Net Income $ $ $570