Which financial statement shows a company’s profitability over a specific time frame?

The income statement is the financial statement that accurately reflects a company's profitability over a specific time frame. This statement provides a summary of revenues and expenses for a given period, typically a quarter or a year. By subtracting total expenses from total revenues, the income statement reveals the net income or loss, effectively indicating how well the company has performed financially during that period.

Unlike the cash flow statement, which provides insights into the inflow and outflow of cash and cash equivalents, the income statement focuses specifically on operational performance and profitability. Similarly, the balance sheet presents a snapshot of the company's financial position at a single point in time, detailing assets, liabilities, and equity without reflecting the performance over any time frame. The financial position statement is not a commonly recognized term in financial reporting, further emphasizing the primacy of the income statement for assessing profitability over time.