Access our free income statement sample template and a business planning course for aspiring leaders. Learn the importance of the Income Statement section of your business plan.
The income statement sample provides a manager or potential investor with the meat of what they are interested in, namely revenue, net income and earnings per share.
"Potential investors and creditors want to know the current worth and potential value of your business before agreeing to partner with you. Help them to help you by providing accurate numbers."
The income statement holds a vast amount of key information. It shows a firm’s revenues and expenses along with taxes associated with those expenses for a specific period of time.
Whereas the balance sheet is organized and viewed as “left and right”, the income statement reads “top down”.
When viewing an income statement sample as part of the business planning process, you should realize that potential investors are extremely interested in net profits. After all, their business is to make money on their investment so they will be very specific in their questions to you about how you intend to earn your income and how you intend to report it.
Our income statement sample lists the revenue and expenses from top to bottom in order to come to the bottom-line net profit number.
Read the income statement in the following order:
It should be noted that depending on the type of business, the format of the income statement sample may vary. Some businesses choose to break down operating expenses into many sub-categories and some may list out the depreciation expense as its own separate line item.
Regardless of how many categories are used, all expenses must be taken into account prior to listing the net profit.
A formal income statement should be prepared monthly so the business owner can stay informed about the sales revenue, expense and net profit trends of the business.
Countless number of professional men without any special ability in business have succeeded financially by means of a courteous manner. Many commercial businesses owe their success in large part to their ability in selecting men and women sales representatives with pleasing manners and personalities.
"Courtesy is to business and society what oil is to machinery. It makes things run more smoothly."
As you build your business plan you should be certain to mention the strengths of your key employees. In addition, you want to provide your strategy for choosing new hires into the organization going forward.
In building up your business you should choose your employees with great analysis and careful thought. Courtesy is one of the key essentials in any service or sales oriented business.
Rest assured, all things being equal, the employee who is selected for advancement is the one who possesses good manners, a fine graceful disposition and a confident presence. These qualities are the best kind of capital, even better than quick one-time profits on any income statement example.
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