How does a multi-step income statement primarily differ from a simple income statement?

A multi-step income statement primarily differs from a simple income statement in that it provides a more detailed breakdown of the company's financial performance by categorizing revenues and expenses into different sections. This categorization makes it easier to analyze the profitability from operating activities versus non-operating activities.

The primary sections in a multi-step income statement often include operating revenues, cost of goods sold, gross profit, operating expenses, and then moves on to other revenues and gains, along with other expenses and losses. This structured approach not only gives a clearer view of operational efficiency but also highlights non-operational factors that can impact overall profitability.

While including Other Revenues/Gains and Other Expenses/Losses adds valuable insight into the complete financial picture, it is this overall categorization and separation that distinguishes a multi-step income statement from a simple income statement, which tends to present a single total for revenues and expenses without this level of detail.