Profit & Loss (Income Statement)
The profit & loss statement, or income statement, shows the money earned and spent over a specific period, providing a look into business profitability.
Understand your profit & loss statement
At the top of a single period report is an overview of your income, expenses and net profit for the date range.
Income and gross profit
The first section of your profit & loss statement details the income accounts and the cost of goods sold (COGS) accounts that make up your business's gross profit.
Gross profit is the total revenue minus the COGS. The COGS includes the costs to produce your product or service. To determine your gross profit margin, the percentage of revenue kept after covering your COGS, divide your gross profit by your total revenue, then multiply by 100.
Operating expenses and net profit
The other section of your profit & loss statement details the operating expense accounts that are subtracted from your gross profit to calculate the business’s overall net profit. Operating expenses are not directly related to product or service production. Examples of these expenses are payroll and wages, advertising, and insurance.
Net profit is your business’s overall profitability. If the total is negative, this is a net loss. Use this number to track your business growth, changes in sales volume and changes in expenses.
View your profit and loss report
On the left-side menu, click Reports.
Under Get the big picture section Click Profit & Loss (Income Statement).
Select the dates.
Click Generate Report.
Click Download for a PDF copy.
📌 Note
for a project Profit & Loss report. Select the Project name before generting the report.
Balance Sheet
Snapshot of what your business owns or is due to receive from others (assets), what it owes to others (liabilities), and what you've invested or retained in your company (equity).
Understand the balance sheet
The core accounting equation is: Assets = Liabilities + Equity.
This equation shows that what a business owns (assets) is funded through borrowing (liabilities) or owner contributions and profits (equity).
Assets
The first section lists all assets owned by the company. This includes your Cash and Bank, Other Current Assets, and Long-term Assets. Assets are organized from the most liquid, or most easily converted to cash, to the least liquid.
Liabilities
The second section lists all current and long-term liabilities. Liabilities are in order of shortest term to longest term.
Equity
The final section details the equity of the business. Depending on the business structure, this may include owner or partner equity, owner investment and draws, common stock, retained earnings, and additional paid-in capital.
View your profit and loss report
On the left-side menu, click Reports.
Under Get the big picture section Click Balance Sheet.
Select As of date.
Click Generate Report.
Click Download for a PDF copy.
Cash Flow
Cash coming in and going out of your business. Includes items not included in Profit & Loss such as repayment of loan principal and owner drawings (paying yourself).
Understand the cash flow statement
All monetary transactions from physical cash, bank accounts, and unreconciled items like deposits and checks, are accounted for in the cash flow statement. They are categorized into three sections:
Operating Activities show the cash transactions related to regular business operations. This includes sales, purchases, inventory, payroll, sales taxes, and other related activities.
Investing Activities show the cash spent and received on fixed assets and long-term receivables. This includes property, plant and equipment, and loans.
Depreciation is not considered an investing activity as it’s a non-cash expense
Financing Activities show the cash inflows and outflows made by the business owner. This includes owner investments and loan proceeds, dividends and draws, and principal loan payments.
The cash flow statement is the only report that shows the owner’s investments and drawings from the business.
At the bottom of the report, there is an Overview where the net total from these three sections is combined with the business starting balance to determine the ending cash balance.
View your profit and loss report
On the left-side menu, click Reports.
Under Get the big picture section Click Cash Flow .
Select the dates.
Click Generate Report.
Click Download for a PDF copy.