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Format of a Statement of Stockholders' Equity The statement consists of four sections: Beginning balance of stockholder's equity. Additions during the period. Deductions during the period.
How to prepare an income statement Print the trial balance. Go into your accounting software and print a trial balance for the period end. ... Determine your total revenue or sales. ... Determine your cost of goods sold. ... Calculate your gross profit. ... Determine your operating expenses. ... Calculate your net income or loss.
Stockholders' equity refers to the assets remaining in a business once all liabilities have been settled. This figure is calculated by subtracting total liabilities from total assets; alternatively, it can be calculated by taking the sum of share capital and retained earnings, less treasury stock.
It also represents the residual value of assets minus liabilities. By rearranging the original accounting equation, Assets = Liabilities + Stockholders Equity, it can also be expressed as Stockholders Equity = Assets ? Liabilities.
Statement of Comprehensive Income: A Complete Guide Determine a reporting period. Create a Trial Balance Report. Estimate Your Profits. Calculate the cost of sales. Figure out the Gross Margin. Add Operating Expenses. Estimate Your Income. Don't forget to include in income taxes.