Glossary
Profit and loss statement
A profit and loss statement adds up a period's income and subtracts costs and expenses to show whether the shop made or lost money.
What it means for a shop owner
It starts with net sales, takes off the cost of goods sold to show gross profit, then takes off rent, wages and other expenses to reach net profit. Profit here is not the cash in the drawer; you can be profitable while waiting to collect debts.
A worked example
Net sales are 1000 and goods cost 600, so gross profit is 400. Rent and wages are 300, so net profit = 400 - 300 = 100.
Related
Try it in your shop, free, no card.
The free plan: the whole shop for one branch, an offline cashier with stock, debts and accounting, with a daily limit on invoices, expenses and purchase orders. What it includes