Profit and Loss Statement Template

You are a certified public accountant with extensive experience preparing financial statements for businesses ranging from sole proprietorships to mid-market companies. You understand that a profit and loss statement is more than a compliance document; it is a diagnostic tool that reveals how efficiently a business converts revenue into profit. You know how to structure P&L statements that meet accounting standards while remaining accessible to business owners who need actionable insights from their numbers.

I need you to create a profit and loss statement for [BUSINESS_NAME], which operates as a [BUSINESS_TYPE:select:Sole Proprietorship,Partnership,LLC,S-Corporation,C-Corporation,Nonprofit Organization].

The statement should cover the [REPORTING_PERIOD:select:Monthly,Quarterly,Annual,Year-to-Date,Custom Date Range] period ending on [PERIOD_END_DATE].

The industry context is [INDUSTRY:select:Retail,E-commerce,Professional Services,Manufacturing,Food and Beverage,Healthcare,Technology,Construction,Real Estate,Hospitality,Transportation,Education,Agriculture,Nonprofit,Other] which will inform the appropriate expense categories and benchmarks.

The statement format should be [FORMAT_TYPE:select:Single-Step (simplified total revenue minus total expenses),Multi-Step (detailed breakdown with gross profit and operating income sections)].

The currency for this statement is [CURRENCY:select:USD ($),EUR,GBP,CAD (C$),AUD (A$),INR,Other].

Here are the revenue figures for this period. Sales revenue or service income totals [SALES_REVENUE]. Any returns, allowances, or discounts that reduce gross sales amount to [RETURNS_ALLOWANCES?]. Other revenue sources such as interest income, rental income, or miscellaneous income include [OTHER_REVENUE?].

For cost of goods sold or cost of services, the beginning inventory value was [BEGINNING_INVENTORY?], purchases or direct costs during the period totaled [PURCHASES_DIRECT_COSTS?], and ending inventory value is [ENDING_INVENTORY?]. For service businesses, direct labor and materials costs are [DIRECT_SERVICE_COSTS?].

The operating expenses for this period include the following categories with their amounts. Payroll and employee benefits total [PAYROLL_EXPENSES?]. Rent or lease payments for facilities amount to [RENT_EXPENSES?]. Utilities including electricity, water, gas, and internet cost [UTILITIES?]. Marketing and advertising expenses are [MARKETING_EXPENSES?]. Insurance premiums total [INSURANCE?]. Professional services such as accounting, legal, and consulting fees amount to [PROFESSIONAL_FEES?]. Office supplies and equipment expenses are [OFFICE_EXPENSES?]. Travel and vehicle expenses total [TRAVEL_EXPENSES?]. Depreciation and amortization for the period is [DEPRECIATION?]. Any other operating expenses include [OTHER_OPERATING_EXPENSES?].

Non-operating items to include are interest expense of [INTEREST_EXPENSE?] and any extraordinary gains or losses of [EXTRAORDINARY_ITEMS?].

The applicable income tax rate or estimated tax expense is [TAX_RATE_OR_AMOUNT?].

For comparative analysis, include prior period figures if available with previous period net sales of [PRIOR_SALES?] and previous period net income of [PRIOR_NET_INCOME?].

Additional context or notes to include in the statement: [ADDITIONAL_NOTES?].

Create a complete profit and loss statement that opens with a professional header showing the business name, statement title identifying it as a Profit and Loss Statement or Income Statement, and the reporting period covered. Include the preparation date for reference.

Structure the statement according to the format type selected. For a single-step format, list all revenue sources with subtotals, then all expenses with subtotals, and calculate net income as total revenues minus total expenses in one straightforward calculation. For a multi-step format, organize the statement to show gross revenue, deduct returns and allowances to arrive at net revenue, subtract cost of goods sold to calculate gross profit, list operating expenses by category with a subtotal to determine operating income, add or subtract non-operating items to show income before taxes, deduct income tax expense to arrive at net income.

Present all monetary figures with consistent formatting, aligned decimal points, and clear subtotals and totals. Use parentheses to denote negative numbers or losses rather than minus signs, following standard accounting presentation. Calculate and display key percentages including gross profit margin as gross profit divided by net revenue, operating margin as operating income divided by net revenue, and net profit margin as net income divided by net revenue.

If comparative figures from a prior period were provided, present them in a side-by-side column format with the current period. Calculate the dollar change and percentage change between periods for each major line item to highlight trends. Flag any significant variances exceeding ten percent with a brief note indicating the change warrants attention.

Include a brief analysis section following the statement that interprets the key findings. Comment on overall profitability trends, highlight the largest expense categories as a percentage of revenue, note any unusual items that affected the period's results, and if comparative data is available, explain the primary drivers of improvement or decline in profitability. This analysis should be two to three paragraphs maximum, written in plain business language that a non-accountant business owner can understand and act upon.

Add a notes section at the bottom of the statement for any accounting policies, assumptions, or disclosures relevant to understanding the figures. Include standard disclaimers noting whether the statement was prepared on a cash or accrual basis and that this is an unaudited management report unless otherwise specified.

Format the statement so it can be easily transferred to spreadsheet software or printed as a standalone document. Use clear section breaks between revenue, cost of goods sold, operating expenses, and the totals section. The final document should be professional enough to share with lenders, investors, or tax preparers while remaining useful for internal management review.