Use our free income statement template to review your business performance, and check out the Wise multi-currency account as a smart way to cut your bank charges.
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What is an income statement?
An income statement sets out your company income versus expenses, to help calculate profit. You’ll sometimes see income statements called a profit and loss statement (P&L), statement of operations, or statement of earnings.
Income statements can be created to analyze and compare business performance over a month, a quarter or a year, and are an effective tool to review cash flow and predict future business performance.
Smart business owners use income statements alongside other key financial documents, like the balance sheet and cash flow statement, to check up on and improve the health of their businesses.
Download a basic income statement template
Download a multi-step income statement template
Download your income statement template.
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Income statement format.
- Revenue, also called sales or business income, includes money received for the sale of the company’s goods or services.
Revenue
- Expenses, commonly referred to as operating expenses, are costs the company incurs related to sales. These might include the cost of goods for resale, property rental, and the price of consumables like printer ink and stamps.
Expenses
- You can calculate your business profit or loss by subtracting the expenses incurred from your revenue. If the number is positive, you have a net profit. If it’s negative, your business has made a loss in that period.
Profit/loss
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Income statement formula.
The single step income statement formula is:
Total Revenues - Total Expenses = Net Income
An income statement compares company revenue against expenses to determine the net income of the business.
Subtract operating expenses from business income to see your net profit or loss. If revenues are higher than total business expenses, you’re making a profit. If your business expenses over the period being examined were higher than your income, the company has made a loss.
This calculation is useful for business owners and investors as it shows the net profitability of a business, and how efficient a company is at generating net income.
Income statements give a snapshot view of business performance - create a monthly, quarterly or annual statement, which you can analyze and compare to performance over the same period in previous years.
How to create the profit and loss statement template?
- Choose the time period used to generate the income statement - this could be a month, a quarter or a year, for example.
Choose the time period.
- Input your business income and expenditure numbers.
Add revenue and expenses.
- Make sure the income statement fits your business by adding and removing line items as you go. Add a line where needed, or you can also easily delete lines from the template as required.
Add or remove line items as necessary.
- Confirm that the formulas are working as intended.
Double check the formulas.
FAQ
Download your multi step income statement template.
To receive the download link on your email, please enter your email address. When you enter your email, you’ll also be signed up to receive the Wise Business newsletter, our free monthly email packed with handy guides and tips on how to grow your business internationally. You can unsubscribe at any time.
Read our Privacy Policy here
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More free online templates for businesses.
More free online templates for businesses.
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