Corporate Finance For Dummies. Michael Taillard

When used in conjunction with other financial statements, the income statement contributes to a number of metrics that measure how effectively a company’s management manages its assets and how well the company yields returns on those assets. Investors can use these metrics to determine whether the company is generating income and wealth on their share of the ownership in the company and whether the company is holding excessive levels of debt that could endanger the value of their ownership sometime in the future. I discuss these different metrics in Chapters 7 and 8.