{"id":15514,"date":"2022-05-31T16:00:04","date_gmt":"2022-05-31T16:00:04","guid":{"rendered":"https:\/\/www.markperlbergcpa.com\/mark-perlberg-cpa-pllcs-guide-to-the-profit-and-loss-statement\/"},"modified":"2022-05-31T16:00:04","modified_gmt":"2022-05-31T16:00:04","slug":"mark-perlberg-cpa-pllcs-guide-to-the-profit-and-loss-statement","status":"publish","type":"post","link":"https:\/\/prosperlcpa.com\/blog\/2022\/05\/mark-perlberg-cpa-pllcs-guide-to-the-profit-and-loss-statement\/","title":{"rendered":"Mark Perlberg CPA PLLC\u2019s Guide to the Profit and Loss Statement"},"content":{"rendered":"
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As a small business owner, you\u2019re often preoccupied with all the things that go into running your Atlanta business \u2013 the daily logistics, managing employee workflow, paying the bills, bringing in more customers\u2026 making a profit. <\/p>\n

Let\u2019s focus on that last one, shall we? Good.<\/p>\n

Profits are the lifeblood.<\/p>\n

And the P&L is probably the most crucial financial statement in growing your Atlanta business.<\/p>\n

But too many people don\u2019t really look at them or even know what to do with them.<\/p>\n

So today, I\u2019m here to help.<\/p>\n

If you want to talk about how you can use these P\/L report thingies better \u2013 or perhaps just how you can chart a financial forward path through times that might currently look a little bleak \u2026 this is what we do:
calendly.com\/mark-perlberg-cpa<\/a><\/strong> <\/p>\n

So let\u2019s get into the details. Firstly, how to BUILD an effective profit and loss statement \u2013 because that\u2019s more than half the battle\u2026<\/p>\n

Mark Perlberg CPA PLLC\u2019s Guide to the Profit and Loss Statement<\/strong><\/span>
\u201cI made my money the old-fashioned way. I was very nice to a wealthy relative right before he died.\u201d – Malcolm Forbes <\/i><\/span><\/p>\n

Your Atlanta small business needs a lot of documents, and one of the most important is your profit and loss statement (P&L). <\/span><\/p>\n

It\u2019s called other names \u2013 income statement, a statement of profit and loss, income and expense statement, earnings statement, statement of financial results \u2013 but it always shows whether your company made a profit in a reported time period. Sure sounds like something your small business shouldn\u2019t be without. <\/span><\/p>\n

What\u2019s on one? Here\u2019s an overview.  <\/strong><\/span><\/p>\n

Why you need a P&L<\/strong><\/span><\/p>\n

Your P&L basically shows your revenue minus expenses and helps make clear how your business turns revenue into profits. <\/span><\/p>\n

Private companies use their P&L for internal management and decisions. Public companies must include a P&L in financial statements for public disclosure. Outside your company, creditors and investors will consult your P&L to estimate risk, and we\u2019ll use your P&L to figure out your taxes and other information for the Internal Revenue Service. <\/span><\/p>\n

Plainly put, the Small Business Administration says the P&L is the best tool for knowing if your business is profitable. <\/span><\/p>\n

What to include<\/strong><\/span><\/p>\n

As we said, the formula for a P&L starts with your sales minus the costs of your goods\/services sold to find your gross profit. Take away your overhead and you have your net profit. <\/span><\/p>\n

The parts are: <\/span><\/p>\n