Purpose

A profit and loss account is a statement of the income and expenditure of a business over the period stated, drawn up in order to ascertain how much profit the business made. Put simply, the difference between the income from sales and the associated expenditure is the profit or loss for the period. ‘Income’ and ‘expenditure’ here mean only those financial amounts directly attributable to earning the profit and thus would exclude capital expenditure, for example.

Importantly, the figures are adjusted to match the income and expenses to the time period in which they were incurred—not necessarily the same as that in which the cash changed hands.

Benefits

This action list provides instant and helpful guidelines.

Related Solutions

Audience

For managers at all levels.

Learning method

Management checklist, answers to FAQs, common traps, and suggested action plans.

Time to Complete

20 minsTAKE 10 MINUTES

Length

5 Pages

Participants

1

Price

£2 Pounds Sterling
(inc. VAT)