Small Business Accounting Information

In the first year of operation, a business can already measure if it made any profit or not. A profit and loss statement for small business shows business owners an overall figure on how much revenue is earned for the business.  It measures a company’s sales and expenses over a specified period of time.

The purpose of a P & L statement is to total all sources of revenue and subtract all expenses related to the revenue. It shows a company’s financial progress during the time period being covered. The categories include net sales, costs of goods sold, gross margin, selling and administrative expenses, and net profits.