The Profit and loss report, or income statement and or statement of earnings as it is also known is a report of the financial situation of the business. It will provide you with important information about the performance of the business meaning that you can plan and budget for future growth and projects. This is usually handled by your finance time. If yours seems a little thin on the ground then you can always get Bookkeepers Hereford based https://office-support.co.uk/bookkeeping to bolster this department with experienced and professional employees.
The profit and loss report is a time based activity. It can be over a month to 12 months long depending on what you are trying to look for from the business or at least ascertain in terms of performance over a short term. The information that the report contains is vital to the running of the business and the setting of its key performance indicators over the coming years.
It contains a full revenue and sales analysis to tell you where the business has performed the best and what areas need room for improvement. This is further illustrated by the Cost of goods sold. In other words how much it costs you to make the product or service you are selling compared with what you retail it at market for. The difference is the profit that you make. This enables you to see what the gross profit is and how and when taxes are adjusted and applied.