In some cases when reviewing an investment you might be presented with an income statement only. The income statement is only one part of the financial statements. You must see all statements in order to get a full sense of the investment potential. The income statement is a great place to start, though!
The income statement shows the income and expense items for a specific period of time, whereas the balance sheet is a snapshot as of a certain date. The first thing to note on the income statement is the time period. Is it for a month, a year, or some other period? The income statement tells you the income that came in and the expenses that went out during this particular time.
