Biz Income Statement
The best vision is insight.
–Malcolm S. Forbes.
The news is full of earnings reports for major corporations. An earning, or profit, is the bottom line of the income statement.
Some call it the Profit and Loss Statement; some call it the P & L. It is a summary of sales and expenses over a period of time. It includes the bottom line, your profits. Unfortunately, profit is just one number. Understanding profit means understanding the details behind it. That requires
- a basic definitions for familiar terms,
- understanding what’s income and what isn’t,
- recognizing what s an expense and what isn’t,
- interpreting your profit margins and
- knowing how to find errors in your own income statement
These aren’t always simple questions. For example, sales (or income) isn’t what is in your cash register or in the bank. Money you collect may include sales tax. Sales tax is money you hold for state and local governments. It isn’t yours.
Not making enough money? Use your income statement. The problem may be low sales, poor margins or high expenses. Use your financials because any change has ripple effects.
- Where’s my money?
- Why did I make less money than last month?
- Your bottom line changed. Why the change, why the amount?
- What will it cost to grow?
- Can I grow by cutting expenses?
Managing a business means understanding your margins. It always takes money to make money. Download the Biz Income Statement now! It will have no impact on your own income statement because it’s free!
