An Income Statement or Profit and Loss Statement is a report that gives the business owner a detailed look at the ability for the business to generate income. Income statements compare sales to expenditures and the net profit after all expense have been accounted for.
A properly prepared income statement report will include:
The statement will include all income for a given period (e.g., month, quarter or annually), by subtracting all expenses from revenue to determine profit or loss for the period. Each business is unique and require differing levels of reporting. Generally, our Wake Forest small business accountants recommend businesses in the early stages receive monthly statements. As a business ages and expenditures stabilize, income statements can be reduced to a few per year or annually.
Over time, the income statements will help determine future operating performances to help the company strategize for expansion.
By managing an income statement businesses can:
Working with an experienced small business accountant will help your business survive the volatile first years of its existence and prepare you for years of success. Our fantastic accounting team is here to help you along the way. Give our team a call today to schedule a consultation for your small business accounting needs.