Personal Income Statement Template
Income Statement Template
Businesses are built to make money. Is yours profitable? How can you be sure? One of the best ways is to generate an income statement. We’ll show you what you need to do to create one, as well as how to interpret one. Income statements are essential to a well-run business.
What Exactly Goes Into An Income Statement?
Every business is subject to periods where they must report the degree of profit they earned. This report is a financial statement; It highlights revenue earned, and subtracts lost income and expenses.
Otherwise known as a net income statement or an earning statement, the income statement is among the three most valuable monetary documents that accountants handle.
Balance sheets show you your assets (everything you own), your liabilities (what you owe and who you owe it to), and your equity (what’s left after everything is settled up). Basically, a balance sheet shows exactly how a business is coming along at a given moment.
Usually, when allied financial interests (banks, investors, etc.) are curious about a company’s profits, this is when income statements come into play.
How To Use
Example Of Income Statement
A visual never hurts. Take a look at this mock income statement for a typical small business:
Random Small Business, Inc.
Year: 2018 – 2019
|Pre-Income Tax Earnings:||$14,209.15|
Most income statements are meant to be analyzed from the top down. It might help to explain some of the terms involved.
This term describes your initial profit. Its determination depends on whether a business deals in cash as well as the length of time occurring before counting revenue.
As a rule of thumb, revenue serves as an estimate for the entire amount of money a business has made before incurring costs, fees, etc. Most often, revenue is divided into monthly, quarterly, and yearly amounts.
Cost of goods sold. This figure will tell you the total cost of production for all goods and services provided to customers – more specifically, direct costs like materials, shipping, labor, and more. This section never includes indirect itinerary like the cost of utilities, using banks, or lodgings.
Gross profit is the amount of money left over when COGS is removed from your revenue. This means that the gross indicates how well a business is profiting at the end of the day. Keep in mind, overhead has not been accounted for yet.
General Operational Expenses
Operating expenses include lots of variables any physical business has to contend with. Examples of these costs include paying rent, banking or ATM fees, the cost of equipment, advertising or marketing, incorporation fees and potentially several others.
Some income statements will lump them together, with a title like “General Administrative Costs.”
Once you’ve accounted for all of the costs and fees your business incurs, your operating earnings are what you’re left with. At this point, all you still have to cover are external payments like taxes and the interest from loans.
Every business owes money to someone at one point or another. Companies usually need to borrow money from a bank or the government near the beginning. Unless you’ve received some sort of grant, chances are you’ll have to pay interest on these loans.
The interest expenses are the cumulative amount of money required to be repaid to lenders within a given period.
The total amount of profit a business has made before it’s time to pay off taxes.
Pretty simple: how much money a company sends to the government for taxes.
This is it, the final stretch. At this point, all the money that’s left belongs solely to the business. This money can be used for payroll, or reinvested back into the company.
Single-step Income: What is it?
In most cases, the income statement listed above is referred to as multi-step. As you might have noticed, several calculations were necessary to determine the actual net profit: gross minus general costs minus interest and taxes = net profit.
Instead, single-step income statements are much more streamlined. The entirety of your revenue is counted, and the only factor needed to subtracted is labeled “total expenses.” After that, you have your net profit.
The single-step method is great for quickly finding out exactly how well your company’s doing in terms of profit, but that’s about it. That’s why it’s not as commonly used as the multi-step version.
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Common-size Income Statement
A common-size income statement is a hassle free way to keep abreast of industry trends and make changes to your business accordingly.
What is it?
The main difference is an extra column of information summarizing every line’s item as a percentage of the entire profit.
For a visual, here’s a common-size addition to the income statement for everyone’s favorite small business.
Random Small Business, Inc.
2018 – 2019
Use An Blank Income Statement Template Excel To Manage Your Own BookkeepingInput your figures into this blank income statement template, and there it is! You have a ready to use Income Statement. This is excellent for business owners who aren’t ready to use an in-depth accounting platform.Blank Income Statement TemplateA blank income statement and balance sheet template gives you the best of both worlds. You can generate a statement to provide a “snapshot” of your business’s current progress, and a balance sheet will help you make better sense of what the numbers mean.Download Blank Income Statement And Balance Sheet TemplateThe experts at exceltemplates.com have crafted an blank Income Statement template Excel that you take advantage of, changing your business’s financial data into an informative Income Statement.
|Cost of Goods Sold||$22,364.56||45.27%|
Use An Blank Income Statement Template Excel To Manage Your Own Bookkeeping
Input your figures into this blank income statement template, and there it is! You have a ready to use Income Statement. This is excellent for business owners who aren’t ready to use an in-depth accounting platform.
Blank Income Statement Template
A blank income statement and balance sheet template gives you the best of both worlds. You can generate a statement to provide a “snapshot” of your business’s current progress, and a balance sheet will help you make better sense of what the numbers mean.
Download Blank Income Statement And Balance Sheet Template
The experts at exceltemplates.com have crafted an blank Income Statement template Excel that you take advantage of, changing your business’s financial data into an informative Income Statement.DOWNLOAD