Which financial statement shows a business's financial condition during a specific period of time?

The Income Statement is the financial statement that provides a summary of a business's revenues and expenses over a specific period of time, such as a quarter or a year. This statement reflects the company's financial performance, showing how much money was generated from sales and how much was spent on operating costs, interest, taxes, and other expenses. Ultimately, the difference between revenues and expenses on the Income Statement results in a net income or loss, which highlights the business's profitability during that period.

In contrast, a Balance Sheet represents a snapshot of the company's financial position at a single point in time, detailing assets, liabilities, and equity. A Cash Flow Statement tracks the flow of cash in and out of the business over a period, focusing specifically on liquidity, while the Statement of Retained Earnings outlines the changes in retained earnings from one period to the next. Each of these statements serves a different purpose in assessing a company's overall financial health, but it is the Income Statement that specifically addresses performance over a designated timeframe.