Developing the Monthly Profit and Loss Statement
In a nutshell, the P&L statement shows all revenues for a business during the month plus all costs related to sales and expenses related to general operations. We develop a monthly statement, but you can use the same format to produce quarterly statements and yearly statements.
As a small business owner, you can use the P&L to assess how well your business is doing, whether you are over or under budget, and what specific expense areas may be contributing to increasing or lowering your net income or profit. Formatting for the P&L is more flexible than the balance sheet and should be designed to meet your business needs.
There are some basic elements that must be in the statement to satisfy outside ...