Amortization income statements provide a snapshot of the costs and other expenses that contribute to producing a company’s total net income or profit. These financial documents are designed to present an overview of the total costs associated with generating the company’s revenue, such as the cost of goods sold, payroll-related expenses, administration costs, depreciation, and amortization.
Amortization is a process in which a business records its intangible assets by deducting their value over time. This type of accounting recognizes that some assets are more valuable up front than they will be in the future, and thus increases profitability in the long-term by spreading out the cost over multiple accounting periods. Amortization income statements provide a comprehensive picture of all of the costs associated with running a business and making it profitable.