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Your Profit and Loss Statement with Moolahmore Mobile App

Do you want to stay afloat and keep the engines of your business running? Then it’s salient to monitor your finances and understand how your business is performing financially. Learn the basics of a P&L statement. Check out why it matters and why the Moolahmore mobile app is a must that can help you track and analyse your business profit and loss. 

Read on.

Defining Profit and Loss Statement

Also known as an income statement, revenue statement, statement of operations or simply P&L—a Profit and Loss Statement refers to a financial report that details the income, expenditures and costs of your business incurred during a specified period. This can typically be for the month, quarter or fiscal year. 

This crucial report or document, at its core, can help you identify and understand the overall financial standing of your company. It can spell out whether you are generating a profit or losing money. It also helps unveil possible financial issues. 

In fact, a P&L statement is one of the three primary financial statements utilised by entrepreneurs and SME company owners like you. Thus, the other two are the cash flow statement (or statement of cash flows) and the balance sheet

Overview / Structure of a Profit and Loss Statement

Here’s a breakdown of components that can be found or included in a P&L statement, along with their meanings:

  • Sales / Revenue

    This is the first section of your income statement that refers to the money your business earns.

  • Direct Costs / Cost of Goods (COGS)

    – Represents the total cost of sales or services or the cost incurred to manufacture goods or services. Thus, take note that COGS usually does not include indirect costs like overhead. 

  • Net Earnings / Net Income 

    To assess your net business income, you must deduct your total spending from your total revenue. 

  • Earnings Before Taxes (EBT) / Net Profit Before Taxes

    You can calculate your EBT by deducting your business’s gross profit from your total expenses and interest expenses.

  • Total Operating Sales / Net Sales

    To determine your net sales, you need to subtract your revenue-related (e.g. returns) from your sales revenue.

  • Earnings Before Interest and Taxes (EBIT)

    You can measure your EBIT by deducting your business’s gross profit from your total expenditures.

  • Depreciation

    Showcases the asset value used up by your enterprise over a period of time. Moreover, this indicates distributing the cost of a long-term asset over its life span.

  • Gains

    The secondary type of revenue represents a positive event that causes your business’s income to boost. Likewise, gains can also include one-time non-business activities such as selling off equipment or property. The difference between revenue and gain is that revenue is the cash obtained by your company on a regular basis. On the other hand, gains are for the sale of fixed assets, which is a rare activity for your enterprise. 

  • Expenses

    Refers to the costs that your enterprise has to pay to generate revenue. Supplier payments, equipment depreciation and employee wages are some examples of common expenses. Thus, there are two main divisions for business expenses: operating and non-operating. 

  • Losses

    These are one-time events that indicate a loss for your business, such as paying a settlement in a lawsuit.

  • Operating Expenses (OPEX)

    Refers to the utilities, rental costs, payroll and other expenses required to run your company. Likewise, this also includes non-cash expenses (e.g. depreciation) 

  • Interest Expenses

    Represent the amount of interest you pay on your business loan or debt. 

  • Interest Income

    This is cash from money market accounts, money from certificates of deposit and similar interest-bearing sources.

  • Income Taxes

    Refers to the local, state and federal taxes.

  • Gross Profit 

    Also known as gross margin or gross income, this pertains to net sales minus the total cost of goods sold in your company.

  • Topline

    Same as your sales/revenue, this is found at the top of your P&L statement. Keep in mind that an increasing top line could mean your business is growing; however, it won’t lead to more profits if your expenses also maximise. 

  • Bottom line

    Refers to your net earnings or income located at the bottom of your P&L statement. If your bottom line is growing, it means that you have a lucrative business.

  • Earnings Per Share (EPS)

    This is applicable if your company has shareholders since this measures how much money shareholders would receive if your enterprise rationed its net income. You can calculate your EPS by taking your total net income and dividing it by the number of outstanding shares.

Types of Profit & Loss / Income Statement

Let’s explore the four main types of P&L/Income statements one by one:

  • Single-step Income Statement – Usually used by small companies with fewer lines to report, this is a simplified form of a P&L statement with subtotals only for revenue, expenses and net income.
  • Multi-Step Income Statment– An alternative and upgrade to the single-step income statement, this shows subtotals for operating income and gross profit. If you want a more accurate view and analysis of your company’s core operations, opt for this type. 
  • Comparative Income Statement – This is a perfect format if you need to compare your net income for multiple periods. 
  • Variance P&L Statement – With this type, you’ll be able to determine the variation between actual and budgeted numbers.

Other Types:

  • Common Size Analysis Income Statement
  • Composite P&L Statement
  • Segmented P&L Statement
  • Driver-based P&L Statement

Where Moolahmore Sets In: Why P&L Statements Matter For Your Business and Why You Need To Use the Moolahmore Cash Flow App

Along with your cash flow statement and balance sheet, the significance of a Profit and Loss Statement should never be overlooked. This critical financial record will give you a comprehensive view and vital insights into how your business has performed financially over a specific period, such as a month, quarter, or year. 

Likewise, knowing how to read and interpret a P&L statement can help you determine whether your company is making money or losing it. You’ll also be able to make strategic decisions about the direction and development of your business. For instance, with a reliable P&L statement, you’ll know when it’s time to invest in growth opportunities or decide when cost-cutting measures may be necessary since you are also aware if you have enough funds to sustain and expand your company.  In addition, a P&L statement is also essential for tax reporting purposes and compliance, as well as seeking out investors or lenders since they would want to ensure that your company is spending money wisely.

That said, you must utilise a powerful mobile-enabled cash flow tool, Moolahmore, to get a convenient, up-to-date and accurate view of your incoming and outgoing funds. With this app, you can generate financial reports such as your P&L statement in a snap and have total control over every aspect of your business’s financial health, even on the go. 


The Moolahmore mobile app is indeed a powerful and convenient tool to help you track and analyse your business profit and loss. It takes the guesswork out of crunching numbers, increases accuracy, provides real-time data and enables you to make decisions that are in the best interests of your business. 

Here’s an ultimate cash flow tool you can always count on! With Moolahmore, you can quickly gain an in-depth understanding of your company’s financial standpoint, identify risks, discover opportunities and make brilliant decisions about how to manage your resources best. Schedule a demo today!