Profit and loss is one of the most important financial statement for a business. It lists all:
- Operating Revenue The revenue from daily business operation. Ex. selling goods or service.
- Cost of Sales: The direct cost to produce product or offer service you are selling. Ex. ingredients of food in a restaurant.
- Operating Expense: The expense necessary to run daily business operation. Ex. management and accounting.
- Non-operating Revenue: The revenue does not come from daily business operation. Ex. gain from foreign Exchange
- Non-operating Expense: The expense does not come from daily business operation. Ex. depreciation.
Gross Profit = Operating Revenue - Cost of Sales
Net Operating Profit = Gross Profit - Operating Expense
Net Profit = Net Operating Profit + Non-operating Revenue - Non-operating Expense
With profit and loss report, we can observe how much profit is made, how it is made, and forecast future performance. Open profit and loss report in Reports > Profit and Loss.
Select start date and end date, Click “Run Report”. The default time period would be the first day of this year to today.