A profit and loss statement, also known as an income statement, is a financial report that displays your total income, total costs (what you pay to produce your product or perform your service), total expenses (what you pay in overhead), and net income for any given time period.
Why do I need a profit and loss statement?
At its most basic level, a profit and loss statement shows if your business is profitable and if your business model is sustainable. If you have a profit, it means that your business is earning more than it spends. If you have a loss, it means your business is spending more than it earns.
You can use a profit and loss statement to answer overarching questions about your business strategy, such as:
Do I have enough revenue to cover my costs and expenses?
Do I have a high return on investment for my expenses?
Does my business earn enough money to pay me, the owner?
Your profit and loss statement can also give you insights about the details of your day-to-day operations, like:
Your top earning revenue streams
Your gross margin (the ratio of your costs of goods sold to revenue)
Your lowest earning revenue streams
Your top spending categories
Where you can reduce your spending
Over time, your profit and loss statement can also show you:
Your business’s growth over a specific period of time
The areas of your business impacting its revenue growth
The areas of your business impacting its profitability
Sales trends and patterns
Every account category is expandable so you can view the accounts and predictions that sit underneath them. You can edit every account line held within your profit & loss. To find out about the Prediction pages controls, please head to the Sales Prediction page article where every area on the prediction pages are explained.
You can also view the Profit & Loss report for Cash Flow. Simply change the view by using the drop down here:
Export financials
Being able to export your financial data for bank loans, shareholders, or stakeholder reporting is important.
Hit the “Export Financials” button to export a five year view of your data for the P&L, Balance Sheet and Cash flow statement, two years of historical data and three years of forecast/budget data. All Account row reordering and account grouping will be preserved and delivered in expandable groups in the Google Sheets export. Export to Excel, or PDF from Google Sheets.