The Ins and Outs of a Profit & Loss Statement (P&L)

The Ins and Outs of a Profit & Loss Statement (P&L)

At Sunrise, our goal is to make accounting as simple as possible for business owners, so you spend more time doing what you love, and less time on bookkeeping. One way we do that is to provide a profit & loss statement when you link your Sunrise account to your business bank account.

What Is a Profit & Loss Statement?

A profit & loss statement (P&L statement) is a financial report that summarizes the revenues and expenses of a specific period of time (usually a quarter or a year). Think of it as a snapshot of your business’ accounting anytime you want it. It’s a convenient way to see what your balance is for your quarterly review, and especially useful come tax season.



Also, it’s a simple way to compare two fiscal periods, say, last year’s Q1 to this year’s Q1. Your P&L statement can show, side by side, the changes in income and expenses over those time periods.

Another use case for profit & loss statements are for lenders to view when determining whether to give a loan to a business. For example, your bank may ask to see your P&L statement to determine the rate of the business loan they would provide for you. All you would need to do is export your P&L statement and send it to your lender for review.

A Profit & Loss Statement vs the Balance Sheet

A profit & loss statement should not be confused with a balance sheet. While they often contain similar data, the main difference is that a P&L statement summarizes revenue and expenses during a certain period of time (i.e., Q1), while a balance sheet provides assets and liabilities for a point in time (i.e., today).

Where to Find Your Profit & Loss Statement in Sunrise

In order for Sunrise to generate your profit & loss statement, you will first have to link your business bank account.


Once linked, you can find the P&L statement link on the left-hand navigation menu under

Reports:


The very first time you open your P&L statement, you’ll see a prompt to enter the first fiscal year of your company. This date would typically be when your business first recorded expenses and revenue.


Your P&L statement is now ready to view by time periods. You can pick your desired time period with the Date range dropdown menu, giving you the most common ranges as well as a custom date range.



The date range you choose will change the Compare with dropdown menu, providing you with the appropriate date ranges whether it be by month, quarter, year, or fiscal year.


Your profit & loss statement will show various accounts by default and many may read 0 if your business has not accrued any values in those accounts. To hide accounts with zeros, click Hide accounts with zero balance. This can make your P&L statement shorter and easier to view.



On the same menu line, you can also toggle on or off Show YTD. This will add or remove a column with Year-to-Date balances. This can be useful when comparing a previous full fiscal year to the current year to date, to show you the progress your business has made compared to previous benchmarks.


The Columns dropdown menu allows you to add or subtract the number of columns in your P&L statement. This can help you compare more time periods. For example, all four quarters of a fiscal year:


The Export button on the upper right hand will give you three choices of export: PDF, HTML, and CSV. For example, a PDF version of your P&L statement would usually be the right choice to send to your bank if they request a copy.


Can the Profit & Loss Statement Show Me More?


Clicking any blue number in your P&L statement will drill you down to an itemized view of the specific account. For example:




Clicking this Gross Receipts of Sales number will drill down to:


An itemized view of this Gross Receipts of Sales account showing each transaction. This is a handy way to see more detail of an aggregate number in your P&L statement, to find any mistakes that may have crept into your bookkeeping.




Your profit & loss statement is an easy way to see the profitability of your business during any time period, providing you with a great method to see the health of your overall company. Click here to go to your P&L statement now.

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