Profit & Loss Statement

A profit and loss statement, also known as an income statement, shows how much money a company made and spent over a specific period, like a month or a year. It helps people see if the company is making a profit or a loss.

  • Revenue: This is the money the company earns from selling goods or services.
  • Expenses: These are the costs the company has to pay to run its business, like rent, salaries, and supplies.
  • Profit (or Loss): This is the amount left after subtracting expenses from revenue. If the revenue is more than the expenses, the company makes a profit. If the expenses are more than the revenue, the company has a loss.

The profit and loss statement helps people understand how well the company is doing financially over a certain period.