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How To Create A P&L Statement

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23 views

How To Create A P&L Statement

Uploaded by

sad
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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— Wix eCommerce School —

How to Prepare a Profit and Loss Statement


for Your Business
A Profit and Loss statement (P&L), shows the sales, revenue and expenses of a business over a period of
time, usually a month, quarter or a year. A P&L is an important part of financial planning for any
business and is often required by banks and other financial institutions to apply for funding and for tax
purposes.

If you have a new business your first P&L will be a Pro Forma P&L, based on projected revenue and
expenses. Every business should prepare and review their P&L at least every quarter. However, new
businesses should prepare a P&L every month for their first year of operations. Some lenders may ask
new businesses to create Proforma P&Ls until they can show their projected break-even point.

To prepare your P&L you’ll need to create an itemized list of your total revenue minus your expenses to
determine your profit or loss. Before you get started using the template below, consider these 2 pro tips:

1. List all of your income and expenses separately, the more detail you add, the easier it will be to
analyze the sources of your income and expenses.
2. Include a percentage column so you can analyze each line as a percentage of total sales.
Profit and Loss Statement Template (1 Month)

Profit and Loss Statement


<Your Company Name>
<month>, <year>

Prior Period Current Period Current Period as % of


Sales

Sales Revenue

Product Sales

Other Income

Returns, Refunds & Discounts


($-)

Total Sales Revenue (J)

Cost of Sales (Beginning Inventory + Purchases - Closing Inventory)

Product/Service 1 (specify)

Total Cost of Sales (K)

Gross Profit (L) = (J-K)

Expenses

Marketing

Advertising

Public Relations

Other

Marketing Expenses (M)

Research and Development (R&D)

Expense 1 (specify)

Total R&D Expenses (N)

General and Administrative (G&A)

Salaries

Contractors

Supplies

Meals and Entertainment

Rent
Telephone

Utilities

Depreciation

Insurance

Repairs and Maintenance

Other expenses (specify)

Total G&A Expenses (O)

Total Operating Expenses


(P) = (M + N + O)

Income from Operations


(Q) = ( L-P)

Other Income (R)

Taxes

Income Taxes

Payroll Taxes

Other Taxes (specify)

Total Taxes (S)

Net Profit (T) = (Q + R - S)

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