Profit and Loss Statements

A Profit and Loss Statement (P&L), also called an income statement, summarizes a business's financial performance over a specific period. It details revenues (money earned) and expenses (costs incurred), showing whether the business made a profit or a loss. The statement starts with total sales, subtracts costs like supplies and wages, and adds or subtracts other income or expenses. The final figure indicates the net income or net loss. This report helps owners and stakeholders understand profitability, manage budgets, and make informed financial decisions.