Generate a simple profit and loss statement for any business. Enter revenue streams and expense categories to see gross profit, operating profit, EBITDA, and net profit.
A P&L (income statement) shows revenue, costs, and profit over a period. It starts with revenue, subtracts cost of goods sold to get gross profit, then subtracts operating expenses to get operating profit (EBIT), then subtracts tax to get net profit.
Gross profit = Revenue - Cost of Goods Sold (COGS). Net profit = Gross profit - Operating expenses - Tax. Gross profit shows production efficiency; net profit shows overall business profitability.
Software/SaaS: 15-25%. Retail: 2-5%. Restaurants: 3-9%. Consulting: 15-30%. Manufacturing: 5-10%. E-commerce: 3-8%. Generally, margins above 10% are considered healthy for most businesses.
EBIT (Earnings Before Interest and Tax) = Operating profit. Net profit subtracts interest expense and income tax from EBIT. EBIT is used to compare operating performance across companies with different capital structures.
Cost of Goods Sold includes all direct costs to produce your product or deliver your service: raw materials, direct labour, manufacturing overhead, packaging, and shipping costs. It excludes rent, admin salaries, and marketing.
Monthly P&L is essential for cash flow management. Quarterly is standard for investor reporting. Annual P&L is required for tax filing. Fast-growing businesses review P&L weekly to catch issues early.
Gross margin percentage — it shows whether your core business model is viable before overhead. If gross margin is negative, no amount of cost-cutting can make the business profitable. Strong gross margin funds growth.