April 2017
Beginner
360 pages
7h 19m
English
Content preview from The Finance Book
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3 Profit and loss (P&L)
‘Business is all about solving people’s problems – at a profit.’
Paul Marsden, business consultant, writer and former politician
In a nutshell
The P&L or ‘profit and loss account’ or ‘statement of profit or loss’ or ‘income statement’ is one of the key financial statements prepared by a company. It shows a company’s financial performance.
The purpose of a P&L is to show the profit (or loss) made by an organisation over a period of time, typically a year. The P&L shows the income generated and various expenses incurred to generate that profit (or loss).
Need to know
The P&L records the financial activities of a business over a period of time. It can be useful to think of the P&L as a video of the business’s journey ...
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