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BookkeepKit

Profit and Loss Template

Fill in your income and expenses and the statement totals itself: gross profit, operating income, net income and margins. Download it as Excel or PDF when it's done.

Statement details

Have the bank statement but not the totals? Import from bank statement to get its transactions in Excel, ready to categorize.

Line items

Income

Total income$0.00

Cost of goods sold

Total cost of goods sold$0.00
Gross profit$0.00

Operating expenses

Total operating expenses$0.00
Operating income$0.00

Other income

Total other income$0.00

Other expenses

Total other expenses$0.00
Net income$0.00

How it works

  1. 1

    Enter the period

    Your business name and the dates the statement covers. Tick “compare” to add a prior period column.

  2. 2

    Fill in the lines

    Rename, add or remove line items in each section. Totals, margins and net income update as you type.

  3. 3

    Download

    An Excel workbook with real numbers in accounting format, or a print-ready PDF with the totals ruled.

How a profit and loss statement is built

Every profit and loss statement follows the same ladder, from the top line to the bottom line. Each rung answers a different question, which is why the template shows each subtotal on its own line:

  1. Income (revenue, sales): everything the business earned from its main activity in the period.
  2. Cost of goods sold: the direct cost of what was sold.
  3. Gross profit = income − cost of goods sold. Divided by income, it gives the gross margin: how much of each dollar of sales is left to run the business.
  4. Operating expenses: the cost of running the business whether or not you sell anything, such as rent, payroll, software, insurance and marketing.
  5. Operating income = gross profit − operating expenses. This is the profit from the business itself.
  6. Other income and expenses: items outside the main activity, such as interest earned on savings, interest paid on loans, or a gain on selling equipment.
  7. Net income = operating income + other income − other expenses. The bottom line.

Filling it in from your books or your bank statements

If your books are current, run a profit and loss report from your accounting software for the same period and copy the category totals. If they aren't, a statement-based approach works for a first draft:

  1. Convert each month's bank and credit card statements to Excel with the statement converter.
  2. Add a category column and assign each transaction to one of your line items. Leave transfers between your own accounts, loan principal and owner's draws out: they aren't income or expenses.
  3. Total each category with a pivot table or SUMIF and enter the totals here.

Bank statements show cash in and out, so the result is a cash-basis statement. If you invoice customers or receive bills, the accrual-basis statement from your books will differ, sometimes a lot, around the start and end of the period.

Comparing two periods

Tick Compare with a prior period to add a second column, for example this year against last year, or this quarter against the same quarter last year. The Excel and PDF downloads add a change column. Comparing equal periods matters: a twelve-month year against a nine-month partial year will always look like growth.

Reading the result

  • Gross margin tells you whether pricing covers direct costs. A falling gross margin with rising sales usually means costs or discounts grew faster than prices.
  • Net margin is the share of income you keep. It's more useful compared over time for the same business than against other businesses.
  • A loss shows in red and in parentheses, the accounting convention, in both downloads.

Frequently asked questions

What's the difference between a profit and loss statement and an income statement?

None: they're two names for the same report. It shows income, minus the costs of earning it, for a period of time. A balance sheet, by contrast, shows what the business owns and owes on one date.

What goes in cost of goods sold versus expenses?

Cost of goods sold covers the direct cost of what you sold: inventory, materials, and labor that goes into a product or a job. Rent, software, marketing and office costs are operating expenses. Service businesses often have little or no cost of goods sold.

Should owner's draws go on the profit and loss?

No. Draws and distributions are payments to the owner, recorded in equity, not expenses. Only an owner's salary paid through payroll (in an S corporation, for example) appears as an expense.

Is my data saved?

In this browser only, so you can close the page and come back. Nothing is uploaded. Use “Start over” to clear it.

Can I use this statement for taxes or a loan application?

It's a management report prepared from your own figures. Lenders and tax preparers may accept it as supporting information, but it isn't a reviewed or audited financial statement, and it doesn't replace a tax return.

Where do the numbers come from?

From your books, or from bank statements if your books aren't up to date. Convert the statements to Excel with the statement converter, categorize the transactions, then total each category here.

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