Profit and Loss

From Bookkeepingpedia
Revision as of 05:31, 15 April 2016 by Lion Admin (Talk | contribs)

(diff) ← Older revision | Latest revision (diff) | Newer revision → (diff)
Jump to: navigation, search

The Profit and Loss or Income Statement will show if your business made or lost money for a given period, usually a calendar month.

The Profit and loss usually has 5 main sections using the figures which come from the Income, Cost of Goods Sold and Expense accounts from the Chart of Accounts

Cost of Goods Sold
Gross Profit
Net Profit

The equation is:

Income - Cost of Goods Sold = Gross Profit

Gross Profit - Expenses = net position for the month.

Sample of Simple Profit and Loss:

Sample Profit and Loss