An 'Income Statement', which is also commonly referred to as a 'Profit and Loss Statement' (P&L Statement), provides a detailed account of a company's financial performance during a specific time period, such as a month, quarter, or year. It lists all revenues (money the business has earned) and expenses (money spent or costs incurred) during that period, culminating in the calculation of the net profit or loss.

For example, an income statement might show that a company earned $200,000 in revenue and had $150,000 in expenses over a quarter, resulting in a net profit of $50,000. Companies use the income statement to analyze their profitability, evaluate operational performance, and make decisions about future budgeting and business strategies.