Business Literacy Institute Financial Intelligence

YouTube
LinkedIn
Facebook
  • Financial Concepts
  • What We Offer
    • Products & Services
    • Live Training
    • Online Financial Training
    • Financial Intelligence Books & Comics
      • Book Excerpts
      • Comic Excerpts
    • Training Topics
      • Income Statement
      • Balance Sheet
      • Cash Flow Statement
      • Cash versus Profit
      • Financial Ratios
      • Return on Investment (ROI)
      • Advanced Topics
    • Financial Intelligence Test
    • Project Management for Profit Training
    • Webinars
    • Money Maps
    • Keynotes
  • Harvard
  • Blog
  • About
    • BLI Team
    • Articles
    • Our Clients
    • Testimonials
    • Interviews
    • Contact
You are here: Home » What We Offer » Training Topics » Income Statement, Profit and Loss, P&L Statement

Income Statement, Profit and Loss, P&L Statement Training

Income Statement, P&L, Profit and LossAn income statement shows the revenue (how much money came in), expenses (what you paid for), and profits (what is left over) for a specific time period. Don’t be confused by all the different names for an income statement, it can also be called a profit and loss statement, P&L, statement of earnings, or statement of operations. Sometimes the word consolidated is thrown in front of those phrases, but it’s still just an income statement. The bottom line of the income statement is net profit, also known as net income or net earnings.

Income statements all follow the same format, some companies will have more items but here are the basics.

Amounts shown are in thousands.

Income Statement Example
  • Revenues, also called sales, is the dollar value of the products or services a company provided to their customers. Some companies break out their revenues into subcategories so they can see where the revenue is coming in from. An example is Google who lists out Google (advertising and other) and Motorola Mobile (hardware and other).
  • Cost of Goods Sold (COGS), also Cost of Sales (COS), or cost of revenue. These expenses relate directly to producing a product or service.
  • Gross Profit (GP) is calculated by taking Revenue – COGS. This provides you with the basic profitability of the product or service you are offering. In our sample company that is Revenue of $100 minus COGS $50 for a Gross Profit of $50.
  • Operating Expenses are the costs that keep a business going, like rent, utilities, salaries, benefits, and insurance. Most companies break these out into different categories to show where the money is going. An example is Apple who lists Research and Development, Selling General and Administrative, Non-Recurring, and Other.
  • Operating Profit, operating income, or EBIT (earnings before interest and taxes), is calculated by taking gross profit minus operating expenses. This is the profit made from running the business.
  • Taxes, Interest, Other – Interest expenses paid on loans, business taxes for the year, and other miscellaneous expenses are recorded in this category.
  • Net Income, net profit, net earnings, or the bottom line, is what’s left over after all the costs have been subtracted from revenue. Hopefully it’s a positive number, if not then it’s a Net Loss.

Training classes go through the key terms on income statements where you will get a clearer picture of what your company is making and what the expenses and costs are. You’ll also go through some key ratios and learn the story the financials tell about your company.

Contact us to set up a live training class or sign up for our online financial statements training.

Sign up for Online Financial Training

Enroll in the Training Now!

Looking for training on the income statement, balance sheet, and statement of cash flows? At some point managers need to understand the statements and how you affect the numbers. Learn more about financial ratios and how they help you understand financial statements.

Our online training provides access to the premier financial statements training taught by Joe Knight. Learn finance in a fun and clear way that's easy and painless.

Find out more

Client Testimonials

"Great speaker; great stories to illustrate his points; I understand finance stories better than ever! I’m impressed because I hate math, & it’s not so scary anymore!"

"Did a great job of putting financial terms in layman’s language."

"Good speaker! Captivating! Passionate!"

"Finance can be a dry subject; this was not! Excellent workshop!"

"BLI delivered; kept a complex topic interesting and applicable."

"Fantastic presentation! Witty, knowledgeable & an outstanding teacher."

Business Finance Training

Learn the basics of the financial statements and the story your numbers tell. BLI offers:

Live Training

Ask questions and participate in discussions as our trainers teach you how to read and understand your financial statements and financial position.

Online Training

Learn at your own pace and go through the financial statements and ratios. Take the quizzes to see how you learned.

Log in to your online training account

We wrote the book on Finance!

Financial Intelligence Books

Financial Intelligence takes you through all the financial statements and financial jargon giving you the confidence to understand what it all means and why it matters.

Do you understand finance? Take our test

Are you smarter than the average manager? Take our nationally validated test to see how much you really know. See how you compare to your boss and co-workers.

Contact BLI

E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Call: (818) 591-5955

Copyright © 2023 Business Literacy Institute · Log in to your online training account