What is an Income Statement?
An Income Statement (also known as a Profit and Loss statement or P&L) is a core financial statement that summarizes total revenues generated and expenses incurred over a specific operating period (such as a month or year) to display the final result: Net Profit or Net Loss.
Structure of an Income Statement
Total Revenue (Sales)
Less: Cost of Goods Sold / Direct Costs
= Gross Profit
Less: Operating & Administrative Expenses
= Net Profit 🏁 (if positive) or Net Loss ⚠️ (if negative)
Frequently Asked Questions
An Income Statement measures financial performance over a period of time (e.g. Jan 1 to Dec 31). A Balance Sheet reports assets, liabilities, and equity at a single specific moment in time (e.g. as of Dec 31).
Automatically in real time. Every transaction you post updates your Income Statement instantly without manual math.
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