Use this template to create a simple income statement.
Use this template to create a simple income statement in Notion. Add your financial year and financial data. Formulas are used to calculate Total Expenses, EBITDA, Operating Income (EBIT), EBT and Net Income.
What you need before purchase
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The six steps to writing an income statement are:
You should pick a reporting period that is long enough to show trends and short enough to be manageable. The most common reporting periods for small businesses are monthly, quarterly, and yearly. Monthly reports give you more detail than quarterly or annual reports. Quarterly reports provide information on how well your company is doing over time. Annual reports provide information about how your company performed in the past year.
A trial balance report shows all the transactions between accounts within a single month. It also includes any adjustments made during the month. A trial balance report can help you spot errors and identify areas where your books need improvement.
Revenue is the amount of money your customers pay you for products and services. You calculate revenue by adding up all sales from your customers. Sales include cash payments, credit card charges, checks, and other forms of payment. If you sell products online, you must add shipping costs to your total sales.
COGS represents the cost of goods sold. This is the amount of money you spend to buy inventory before selling it to customers. You determine COGS by subtracting the value of inventory at the end of the accounting period from the value of inventory at beginning of the accounting period. For example, if you bought $10,000 worth of inventory at the beginning of the accounting period but only sold $8,000 worth of inventory by the end of the accounting, then you would have spent $2,000 on COGS.
Gross margins represent the difference between what you paid for inventory and what you actually received when you sold it. Gross margin is calculated as follows:
Cost of Goods Sold ÷ Revenue Gross Margin
Include Operating Expenses
Operating expenses are those items that don’t directly relate to making a profit. Examples of operating expenses include rent, utilities, insurance, payroll, advertising, and supplies. When calculating gross margins, you deduct these operating expenses from your revenues.
The simplest type of income statement is a single-step income statement. In this case, you simply list one line item per account. For example, here’s a single-step income report for a restaurant:
Account Name | Description | Amount
Sales | Total sales | $100,000
If you want to break down your income into several categories, you use a multi-step income statement. Here’s an example of a multi-step income report for the same restaurant:
Cost of Goods Sold
You may find it easier to read a contribution format income statement than a traditional income statement. The contribution format shows how much each part of your company contributed to your overall profits. It also provides information about which parts of your business were profitable or unprofitable.
An income statement is a financial document that tells you how well your business did during a specific time period. A balance sheet is a financial document that shows how much money your business has in total assets and liabilities.
A balance sheet shows all the money your business owns. Assets include things like cash, accounts receivable, buildings, equipment, vehicles, furniture, and other physical property. Liabilities include debts owed to banks, suppliers, employees, landlords, and others.
An income statement shows how much money your company made during a certain time period. It includes revenue (money you receive), costs (expenses incurred to make products or services), and net income (profit). Net income is the difference between revenue and costs.
A cashflow statement shows what happens to your company’s cash over a particular time period. It lists all the money coming in and going out of your company.
Cashflow statements show how much money your company spent on goods and services, as well as any payments to creditors. They also tell you whether your company paid its bills on time.