What summarizes profit making activities over a specific period of time?

The correct choice highlights the document known as the Profit and Loss schedule, which summarizes all profit-making activities over a designated period, typically a fiscal quarter or year. This financial statement provides a comprehensive overview of revenues, costs, and expenses incurred during that timeframe, ultimately resulting in either a profit or a loss for the business.

Unlike a balance sheet, which offers a snapshot of a company’s financial position at a specific point in time, the Profit and Loss schedule focuses on the company’s operations over time, detailing how much money was made (revenues) and how much was spent (expenses).

The cash flow statement, while important for understanding the inflow and outflow of cash, does not directly summarize profit-making activities or provide insight into the profitability of operations. Similarly, the income statement, while often used interchangeably with the Profit and Loss schedule, generally refers to the same type of financial report, but using the term in this context helps reinforce the distinction of summarizing profits and losses over time specifically as labeled in the question.