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Aug 6th, 2022
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How to finish word in the Profit and Loss Statement

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in this video youll learn whats an income statement is Ill show you what it looks like and how you can use it to measure a businesss financial performance hey there welcome back to accounting stuff Im James and in todays video were going to cover the income statement also known as the profit and loss statement or the PL for short this is one of the three major financial statements in accounting along with a balance sheet and the cash flow statement collectively these reports give us an impression of the businesss financial health so its important that we understand how they work Ive already made videos covering the balance sheet and the cash flow statement which you can find linked up here and down below in the description but up until now I havent posted a video yet on the income statement and Ive received a lot of requests from you guys to cover this topic so thanks for all these particularly from one subscriber so Nili if youre watching this video goes out to you good

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In Conclusion The PL Statement is a critical document that can help you understand your business profitability and operational efficiency. Along with the balance sheet and the cash flow statement, it can let any investor, creditor, or analyst understand the intricacies of how your firm conducts its operations.
Profit Loss Account summarizes business income and expenses during a period, essential for assessing profitability and decision-making. Important components include revenue, COGS, operating expenses, operating profit, net income.
The main categories that can be found on the PL include: Revenue (or Sales) Cost of Goods Sold (or Cost of Sales) Selling, General Administrative (SGA) Expenses. Marketing and Advertising. Technology/Research Development. Interest Expense. Taxes. Net Income.
Creating a PL statement for small business Sales. The first thing reported on a PL statement is the businesss revenue from sales. Cost of goods sold (COGS) Next, businesses that sell goods must figure the cost of the goods theyve sold. Gross profit. Other income. Expenses. Net profit or loss. PL example.
The following are easy steps in creating a comprehensive Profit and Loss Statement for your business: Track Operating Revenue. Record Cost of Sales. Calculate Gross Profit. Determine Overhead. Add Up Operating Income. Consider Other Income and Expenses. Finally Arrive at Your Net Profit.
A profit and loss (or income) statement lists your sales and expenses. It tells you how much profit youre making, or how much youre losing. You usually complete a profit and loss statement every month, quarter or year.
Five key features of PL statements Revenue. This is the total amount of money earned from sales or other sources during the relevant period usually a month, quarter, or fiscal year. Cost of goods sold (COGS) Gross profit. Expenses. Net profit.
The difference, known as the bottom line, is net income, also referred to as profit or earnings.

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