Profit and loss (P&L) statement

A P&L, also known as a profit and loss statement or income statement, is a financial document that summarizes a company's revenue and expenses over a specific period, typically a month, quarter, or year. It shows how effectively a business is converting its sales into profits.

Accounting and Finance

What is a P&L?

A profit and loss (P&L) statement, also known as an income statement, summarizes a company's revenues, costs and expenses over a specific period. It shows the net profit or loss and is essential for assessing financial performance and making strategic decisions. The P&L statement helps stakeholders understand how well the company is generating profit from its operations.

Analyzing the P&L statement allows businesses to identify trends, assess the impact of cost-control measures and make informed decisions about future investments. It’s a very important tool for financial planning and analysis, providing insights into areas where the company can improve profitability and efficiency.

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