Income statement, also called profit and loss statement (P&L) and Statement of Operations is financial statement that summarizes the revenues, costs and expenses incurred during a specific period of time – usually a fiscal quarter or year. These records provide information that shows the ability of a company to generate profit by increasing revenue and reducing costs. The purpose of the income statement is to show managers and investors whether the company made or lost money during the period being reported. The important thing to remember about an income statement is that it represents a period of time. This contrasts with the balance sheet, which represents a single moment in time. A typical format of the Profit & Loss Statement has been given below.
FORMAT OF PROFIT & LOSS STATEMENT
Profit & Loss Statement of XYZ Company
- Turnover
- Cost of sales
- Gross Profit
- Distribution cost
- Administration Expenses
- Other income
- Operating Profit
- Income from other investments
- Profit before interest
- Net interest
- Profit before Tax
- Tax Payable
- Profit after tax
- Dividend
- Retained profit