Have you ever wanted to know the basic story of a popular book or movie, but weren’t too interested in spending the hours to read or watch in its entirety? The basic solution is to look at a synopsis. A synopsis is a brief description that goes over the most important points of whatever it’s describing. Synopses can be used for a variety of reasons, such as finding out if a particular movie would be enjoyable for a party or preparing a book report on a book that you may or may not have read.
An Income Statement, sometimes referred to as a Profit & Loss Statement, can be like a synopsis for your business. It shows the activity of a particular period from beginning to end without having to look at each transaction. With it, you can see how profitable your business has been over time and make educated choices for future business decisions.
Here are a few suggestions to keep your Income Statement as useful as possible:
- Keep income and expenses up to date. This helps simplify the review process.
- Review several months at a time or year over year. This allows you to see trends and make quick adjustments when income or expense amounts change.
- Print the report so it is totaled by month. This helps get a good idea on what changes happen from month to month.
We want your business to be a success story. If you have questions on how to use income statements, or just have general questions about QuickBooks, payroll, or taxes, give us a call at Stapley Accounting.