Fillable Form Profit & Loss Statement
A fillable Profit & Loss Statement, which is a financial statement or business report that shows the revenues, costs and expenses incurred during a specified period.
What is a Profit and Loss Statement?
A profit and loss statement, also called a P&L statement, is a financial report that helps businesses evaluate their financial performance over a specific period. This document is essential for identifying areas to improve financial management.
Why is a Profit and Loss Statement Important?
P&L statements help:
- Allow companies to see how well they’ve done financially in the past and plan for the future.
- Give business owners and managers a clear picture of where revenue is coming from and how expenses are being allocated.
- Calculate net income which determines the income tax owed.
P&L statements are a key tool for working professionals to track income and expenses, making it a valuable resource for both business and personal finance management.
How do you prepare a profit and loss statement?
To prepare a P&L statement, gather your business’s income and expense data for a specific period (usually one year). This document will show your revenue and costs, helping you determine if the business made a profit. Use a profit and loss statement template if necessary.
How to Fill Out a Profit and Loss Statement
Follow these steps to complete the profit and loss statement template correctly:
Step 1: Use a Template
Use the fillable profit and loss statement template found here.
Step 2: Complete the Key Sections
- Company Information
- - Enter the business name.
- - Enter the business address.
- - Enter the start date of the time period being evaluated.
- - Enter the end date of the time period being evaluated.
- - Enter the name of the person who made the P&L statement. If multiple people made it, enter all of their names.
- - Enter the date of when the P&L was created.
- Income
- - Enter the income generated by sales for this period.
- - Enter the income generated from other sources besides sales for this period.
- Expenses
- - Enter the expenses incurred for this period from the following:
- Advertising Expense
- Bank Charges
- Depreciation
- Equipment Rental
- Insurance
- Interest
- Office Supplies
- Postage & Printing
- Repairs & Maintenance
- Salary
- Telephone & Internet
- Training & Seminars
- Utilities
- Vehicle & Transportation
- Other Expenses
- - If you have other expenses not covered by the previous section, enter the name of that expense. Then enter the value of that expense.
- - If you have more expenses to add, tick the box to add another row.
Once you have filled out all fields, you have finished the profit and loss statement template.
FAQs About Profit and Loss Statements
What happens if a business does not use profit and loss statements?
Without a profit and loss statement, a business lacks a clear understanding of its financial performance, which can lead to poor decision-making and potentially critical consequences.
What is the goal of profit and loss statements?
The goal is to help businesses assess their financial health by showing earnings or losses over a period. These statements inform management about the impact of their decisions on overall productivity and profitability.
Do I need a profit and loss statement?
If your business has employees, sells products, or uses double-entry accounting, you need a profit and loss statement to understand your financial position.
What are profits in a business?
Profits are the earnings left after subtracting all expenses from revenue. It’s a key measure of financial success.
What is business income?
Business income refers to money earned through regular operations, such as sales or services. It may also include proceeds from selling assets or loans.
What are business expenses?
Expenses are costs necessary to run a business, such as salaries, utilities, and supplies. They must be reasonable and directly related to business operations.
How do you calculate net profit?
Use this formula: Net Profit = Total Revenue – Total Expenses
What is a profit account?
A profit account tracks all profit and loss items in a journal. Transactions recorded in the Profit and Loss statement are posted here. It’s an essential tool for quickly viewing a business's profit and loss.
How do I calculate profit percentage?
To calculate profit percentage, subtract the cost of a product from its selling price to determine the profit. Then, divide that profit by the cost of the product and multiply by 100 to get the percentage. For example, if a book costs $20 and sells for $25, the profit is $5, and the profit percentage is 25% (5/20 = 0.25 or 25%).
How do I calculate profit per unit?
To calculate profit per unit, use this formula: Profit per Unit = (Revenue – Cost) / Units Sold. For example, if you sell a widget for $5, and it costs $2 to make, the profit per unit is $3 ($5 – $2).
How do I calculate my revenue?
Revenue is the total income from sales of your product or service. Calculate it by adding up all sales within a specified period, such as daily, weekly, monthly, quarterly, or annually. Larger businesses may use projections for future revenue.
How do I calculate the cost of my product or service?
The cost of your product includes direct costs (e.g., materials, wages) and indirect costs (e.g., rent, insurance). Add all these costs together to determine the total expense for producing each unit.
Is P&L the same as an income statement?
A profit and loss statement is different from an income statement, even though they share similarities. Both show financial performance over a period, but the income statement reports overall earnings, while the P&L focuses on profits or losses per department or division.
How do I read a profit and loss statement?
To understand a profit and loss statement, you should know its structure and what each section means. The P&L helps management assess business performance by showing revenue, expenses, and profits, comparing data across periods or departments.
Why are profit and loss statements important?
Profit and loss statements show a company’s financial health, indicating how it reached its current state and whether future investments are wise. They also help explain any losses, so employees can adjust strategies to improve profitability.
What should you look for in a profit and loss statement?
Look for trends in profitability across different sections of the P&L. If certain areas are underperforming, it might be time to adjust marketing strategies, focus on more profitable products, or expand the customer base.
Why do we need a profit and loss account?
A profit and loss account is essential to determine a business’s financial success. It can be in the form of a single-step income statement, which summarizes financial activity, or a multi-step version that provides more detailed insights by separating expenses and income into categories.
What is the difference between a profit and loss statement and a balance sheet?
A profit and loss statement reports a business’s earnings and expenses over a period, showing whether there was a profit or loss. A balance sheet, however, lists the company’s assets, liabilities, and equity, offering a snapshot of the financial position at a specific point in time.
Do loan payments go on the profit and loss statement?
Only the interest portion of loan payments should be recorded on the profit and loss statement, not the principal.