Introduction to the income statement | Stocks and bonds | Finance & Capital Markets | Khan Academy

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  • Опубліковано 23 січ 2025

КОМЕНТАРІ • 154

  • @mizzprinks
    @mizzprinks 13 років тому +4

    I am a medical student and recently an MBA student to learn about finance. This is the first time I actually wanna learn finance after starting the course, because it was simply so boring to a medical student like me and made absolutely no sense. Now it does, THANKYOU! GOnna watch the rest of your economics videos::)

  • @khanacademy
    @khanacademy  15 років тому +4

    That is one of the definitions. The standard formula takes out the effect of interest and tax savings from interest and is (net income + interest - tax savings from interest)/Assets which is essentially saying how much earnings would I have if I weren't paying debt. If you wanted a pre-tax ROA than you could just add back interest and taxes and divide by Assets (or EBIT/Assets which is, for the purposes of this examples, the same as Op profit/Assets

  • @emmajackson3205
    @emmajackson3205 11 років тому +2

    You have saved my life! i have a huge business studies booklet due and i couldn't finish it without doing this and i did it!!! thankyou xxx

  • @Vhuimo
    @Vhuimo 11 років тому +3

    awesome dude!!!, writing my exam tomorrow and they better not bring up the income statement because imma bowl it out like a boss after this video!!!#fFromSouthAfrica

  • @royray3671
    @royray3671 4 роки тому +1

    My accounts teacher is wack and i never understand what he teaches
    But when i come to your channel it makes it so better.
    Thank you.❤

  • @ramyaviswesh
    @ramyaviswesh 10 років тому +15

    Thank you! so much for all your teachings.I am able to learn financial statements better! than any regular class teachings. Thank you soo much, God bless u and u r family

  • @oshua132
    @oshua132 10 років тому +9

    Thank you Mr. Khan, these videos are going to allow people to understand this information and get in a game that they have been on the tail end of. Thank you, thank you, thank you. Many blessings to you and your family.

  • @Teeybabyboo
    @Teeybabyboo 10 років тому +28

    That you so much for this video. I am currently registered in a finance class, and This is just what i needed to brush up on my accounting. very well explained, and easy to understand.

  • @matthewreid2664
    @matthewreid2664 10 років тому +9

    Thank you for explaining accounting to a marketing person in very simple terms....I've been struggling with my lecturer!

  • @wonderphill5710
    @wonderphill5710 8 років тому +4

    im in grade 7 in 2016 and it helps a lot with my entrepreneurs' day

  • @RansonJoe
    @RansonJoe 8 років тому +4

    Your channel is an incredible resource. Thank you!

  • @twingirlmk4128
    @twingirlmk4128 5 років тому +3

    Thanks so much for your amazing explanation for us. I can learn income statement better than before. In the class I really difficult to caught up a lesson with professor and I also can not understanding some point, but now I can understand 50% of it and I also learn to do some exercise too. ❤️😅

  • @gilpuy
    @gilpuy 14 років тому

    yesss...very outstanding explanation...helping to understand all of those subject that makes me suck,but now i start to like it...you are amazing mr khan, i hope my real lecturer in campusis you sir...salute from indonesia

  • @TheColoredComrades
    @TheColoredComrades 12 років тому

    i just want to say I find you to be a very inspiring man and look forward to volunteering on your site as a translator.

  • @tariqsheikh5569
    @tariqsheikh5569 10 років тому

    Every time when you repeact these things, learn something new. Thanks for explanning in such an easy way.

  • @InstTaxSolutionsLLC
    @InstTaxSolutionsLLC 11 років тому +1

    Excellent presentation about an income statement, which may also be known as a profit and loss statement. This is one of the most basic accounting documents, but it is also one of the most used financial reports.

  • @lizyip7951
    @lizyip7951 7 років тому +1

    Thanks so much! I finally understand what is ROA and ROE!

  • @oneskill_ppt
    @oneskill_ppt 8 років тому +9

    well explained, thanks Khan :)

    • @linuxd
      @linuxd 4 роки тому

      He explains everything! From cells, to atoms, to finance.
      You're the man Khan

  • @armani8983
    @armani8983 7 років тому

    I thought about khan's academy while watching this video and saw channel name after it, omg it's khan's academy video ! awesome.

  • @thulethianh
    @thulethianh 6 років тому

    Thanks for your teaching. It's really easy to understand. Wish you all the best

  • @sandbar3000
    @sandbar3000 3 роки тому

    I loved your video on the usefulness of the balance sheet. I love roi roa...
    And how liquid is the company.
    I have an MBA in 2011. But my depression has kept me low and it's very hard to sell my skills in job interviews. I have watched 25 videos of yours in this series so far. If it was not for my depression...I'd teach accounting!

  • @JediFight
    @JediFight 13 років тому

    Great slow explanation. Thank you. Very nice to have information like this available.

  • @Systematik101
    @Systematik101 12 років тому +1

    This was a really good video tutorial! Thanks Man!

  • @nkamal2007
    @nkamal2007 12 років тому

    @khanacademy thankyou very much..apecial thanks to Mr. Salman Khan...

  • @Dayao12
    @Dayao12 11 років тому

    I'm passing my quiz tomorrow! Thanks so much for this tutorial!

  • @diogocorreacoelho4288
    @diogocorreacoelho4288 12 років тому

    Damn fam, straight up you a G! Probably best explanation online! real talk, 100.

  • @piko9311
    @piko9311 9 років тому +1

    This is very helpful, thank you very much indeed!

  • @iambond123
    @iambond123 15 років тому

    HI Sal Your videos are really Usefull.
    Thanks Indeed
    Chirag Ali

  • @2525georgia
    @2525georgia 13 років тому

    Why can't my lecturer explain it like this!!!! Thanks, you're the best!

  • @0nlyt0me
    @0nlyt0me 8 років тому

    Great way of teaching this. Thanks!

  • @Dapgirl70
    @Dapgirl70 12 років тому

    Great video! I'm feeling more confident. Thanks you!

  • @hassanbazzi3545
    @hassanbazzi3545 5 років тому +1

    Thank you so much for your explanation.

  • @megaelliott
    @megaelliott 15 років тому

    Thanks Sal for these videos.

  • @NP-cx8oc
    @NP-cx8oc 11 років тому +2

    Thank you! It's very clear.

  • @rolexshadow
    @rolexshadow 6 років тому

    I have my final tomorrow and now I'm much more confident taking it

  • @jangzterrizer9405
    @jangzterrizer9405 7 років тому

    My goodness you're a good teacher

  • @nicoa263
    @nicoa263 7 років тому

    Not trying to dis. This guy is amazing and I learn from him everyday. But just to put my .2 out there. ROA is Net income divided by Total Assets. Just for all the people to know, one must account for Continuing Operations and Non-Recurring events to get the total net income. The example above, though perfect for covering the basics, is assuming that the operating profit is the net income to get the ROA.

  • @angeisrael6478
    @angeisrael6478 5 років тому

    Thank youu so much I understand it better now

  • @vendettahappyno2769
    @vendettahappyno2769 8 років тому

    not what I needed but u r still quite smart .

  • @yasu_tv
    @yasu_tv 13 років тому

    Income Statement/Balance Sheet/Cash Flow Statement/G&A/SG&A/Cost of Goods Sold/Marketing/Sales/Gross Profit/Operating Profit/Enterprise Value/Return on Asset/ROA/Pre-tax Income/Net Income/Depreciation/Amortization/Return on Equity/ROE/Variable Cost/Fixed Cost/Sales People/Auditor/plain vanilla/jumble up/nuance/detract/

  • @MrDaddydiva
    @MrDaddydiva 6 років тому

    This could be the most useful video for start up's.

  • @Gilvids
    @Gilvids 4 роки тому

    This is gold!

  • @LigiaChacon1414
    @LigiaChacon1414 10 років тому

    Interesting way to abbord concepts of financial statements. I could say that im known more about this area.

  • @HussainPhoto87
    @HussainPhoto87 11 років тому +1

    Damn Accounting professor. You're my man!

  • @hechen9980
    @hechen9980 8 років тому

    very helpful for me in a accounting college

  • @shirleygaietymoyo8041
    @shirleygaietymoyo8041 9 років тому

    this was very helpful, thanks a lot

    • @AZAZEL_TK
      @AZAZEL_TK 9 років тому +1

      Giiiiiiiiiiiirrrrlll

  • @xx480o
    @xx480o 9 років тому +1

    Just what u needed!! Thanks a lot :)

    • @AllDailyInspirations
      @AllDailyInspirations 9 років тому

      +Faiza Ismail lol u? or "i"

    • @xx480o
      @xx480o 9 років тому

      +Linda A true I* lol :'D

    • @xx480o
      @xx480o 9 років тому

      +Linda A true I* lol :'D

  • @shashank4277
    @shashank4277 4 роки тому

    Beautiful!!

  • @delinquent2002
    @delinquent2002 14 років тому

    You are really helping me to understand the things i did not understand befor...lol. I have a question and maybe you can help me with this.. I buy Merch.. from a wholesaler out of California. When I recieve my merch... and the invoice from the wholesaler there is a Freight charge. When i do my Quarterly Taxes, do i include the freight charges? Or is it a deduction?

  • @amandeepaaaaa
    @amandeepaaaaa 12 років тому

    thanks man.. i like your stuff...

  • @ThunderersTriumph
    @ThunderersTriumph 12 років тому

    Nice help, thank you!!!!

  • @noisternes
    @noisternes 11 років тому +1

    HI SAL! Thanks.

  • @cool70200
    @cool70200 15 років тому

    Thanks for the video.

  • @rutujabankhele1889
    @rutujabankhele1889 5 років тому

    better than my accounts proffessor!!!!!!!!!!!!

  • @uknwtheusername
    @uknwtheusername 12 років тому

    Question: where would you find the figure for the company's total assets inside their financial statements (i.e. income state., balance sheet, cash flow statement, etc.)?

  • @rawsip5037
    @rawsip5037 6 років тому

    very well explained

  • @thehoneybadger9389
    @thehoneybadger9389 5 років тому

    Thank you very much :)

  • @SuperJillian
    @SuperJillian 12 років тому

    Great videos, thank you. Question: You explained ROA = 1M/10M=10% in which $1M came from Operating Profit. I thought it should be Net Income, which is $350,000. Please explain since I am confused! Thanks

  • @devbodaghe
    @devbodaghe 12 років тому

    In real estate operating profit will bet the same thing as net operating income (NOI). Expect that taxes is included included.

  • @owldat
    @owldat 12 років тому

    Awesome!!

  • @clubchelas4471
    @clubchelas4471 12 років тому

    this is great...thank you.

  • @AbhaySoorya
    @AbhaySoorya 12 років тому

    Hey Sal - Thanks for making these videos..Quick question - you said that ROA = Operating profit/Total asset value....I thought it was Net Income/Total Asset Value? PLEASE confirm this..Thanks!

  • @samreenashraf6426
    @samreenashraf6426 3 роки тому

    helpfull. thank you

  • @ohmitchiebabe
    @ohmitchiebabe 15 років тому

    :) Easy to understand video

  • @Travis_1997
    @Travis_1997 11 років тому +1

    Khan :) thank you

  • @daniellos333
    @daniellos333 9 років тому

    very concise.

  • @alfiedj
    @alfiedj 15 років тому

    Yea, thx man, helpful stuff!

  • @jcdlrv
    @jcdlrv 14 років тому

    hi, i want to know what is the next video i would see after price and market capitalization.

  • @Geesjuh
    @Geesjuh 13 років тому

    thankyou so much!!

  • @anzwertree
    @anzwertree 14 років тому

    Dude, you rock

  • @imcurious1009
    @imcurious1009 3 роки тому

    Legend!

  • @moekrueng
    @moekrueng 13 років тому

    Thank you

  • @gothicking999
    @gothicking999 14 років тому

    Excellent, just one question though, whats a widgit?

  • @meanmanturbo
    @meanmanturbo 14 років тому

    Maybe a little to much detail, or maybe it is just a difference between US and Sweden (since we have all these nice taxes here...), but when I did this at university you would always try to max out write downs on assets to minimize pre tax income to minimize the taxes you pay. Of course, this is bad for share holders, since it would make the company look worse of then it really is.

  • @PercyWellington
    @PercyWellington 5 років тому

    is the interest actual interest or interest + principle? like from a mortgage payment?

  • @lucuslucuses5595
    @lucuslucuses5595 5 років тому

    Are wages a part of SG&A?

  • @AminaLn
    @AminaLn 8 років тому +8

    Is there anything you can't explain? I wish I had such a broad knowledge of so many different topics.

    • @Redmile2006
      @Redmile2006 7 років тому +12

      travel bug That's what happens when we spend our free time reading books and watching educational videos instead of playing video games and watching Netflix :)

  • @zufrieden23
    @zufrieden23 13 років тому

    the best!!!!!!!!!!!

  • @poshstars
    @poshstars 15 років тому

    you r right .

  • @ruthlessluder
    @ruthlessluder 7 років тому

    Is the ROA = net income / asset? In your example it's operating profit / asset.

  • @loveormoney786
    @loveormoney786 5 років тому

    Is CapEX included in COGS?

  • @kingtigercrownestate9102
    @kingtigercrownestate9102 2 роки тому

    Assuming that payroll for ALL employees is included and not just sales people right?

    • @MrC3P
      @MrC3P 4 місяці тому

      i have this same question. where would all salaries located in?

  • @sultanbalobaid2463
    @sultanbalobaid2463 12 років тому

    thanks broo

  • @blahlul95
    @blahlul95 8 років тому +1

    Why is return on assets based off the operating profit and not the net income?

    • @desse56
      @desse56 8 років тому

      Great question, was thinking about the same

  • @KLFacebook
    @KLFacebook 12 років тому

    better than our doctor

  • @atrumluminarium
    @atrumluminarium 12 років тому

    It's that easy! :O

  • @emanghaith247
    @emanghaith247 11 років тому

    I know you have posted this long ago but i hope you still check the comments as i wanna say it feels like having a private tutor , Thaaaaaaaaaank you

  • @jed_Garces
    @jed_Garces 6 років тому

    Is Operating profit same as EBITDA?

  • @KarenSanderson1
    @KarenSanderson1 12 років тому

    Revenues minus cost of doing business is income.

  • @mehwhyausername1
    @mehwhyausername1 3 роки тому +1

    ROA really isn't generally based on operating profit. almost everyone uses net income as a general rule.

  • @shashankkalra990
    @shashankkalra990 6 років тому

    plz correct me if I am wrong but ROA is net income divided by total assets not operating profit divided by total assets

  • @TheSolidsnake2001
    @TheSolidsnake2001 13 років тому

    Hi Sal, I think there is a mistake here in this video about the ROE & ROA defination. The ROE is 350K/5m = 7% and the ROA is 350K/10m = 3.5%

  • @linuxd
    @linuxd 4 роки тому

    I'm doing this alongside a live company that I'm looking at and some of these numbers aren't adding up.
    This company I'm looking at has 230 million revenue. Gross income is 27.97 million. And the operating income is 50 million. I'm missing something. I don't understand how operating income is more than gross income.

  • @twentysixstrings
    @twentysixstrings 4 роки тому

    Where is assets depreciation in costs of Income statement ?

  • @Gilvids
    @Gilvids 4 роки тому +1

    all this seems complicated to start this grand scale of a business down to only getting few thousand dollars income. on the other hand you have people shooting a ball in ring and gets paid millions of dollars a year. oh the world is not fair!

  • @fionaNESS
    @fionaNESS 12 років тому

    statement of changes in equity!!!

  • @iNinjaNotes
    @iNinjaNotes 13 років тому

    @Ren1026cbcc Sales are NOT taxed. Only pre tax income is taxed, which should be one of your last numbers on your income statement before calculating tax. All of those expenses like cost of goods sold, interest expense, marketing expenses reduces your taxable income. If you were to tax sales @ 30% it would be $900,000 of tax. This wouldn't make any sense right? Because the cost of all the goods you produced is $1,000,000.
    Always make sure that the numbers make sense!

  • @nervozaur
    @nervozaur 11 років тому +1

    hahaha, nailed it!

  • @Amicoskates01
    @Amicoskates01 5 років тому +6

    Imagine owning a business that does 5 mil in sales, but only profits 350k.
    Sheesh

  • @ayushrajsingh261
    @ayushrajsingh261 12 років тому

    You didnt subtract debt anywhere. Shouldnt we subtract "debt + interest" from operating income??