1. PROFIT AND LOSS
STATEMEMT
Mohammed Gaus Shaikh 046
Mohammed Habib Siddiqui 047
Mohammed Ahmed Raza Khan 048
Mohammed Mikaail Shaikh 049
Mujtaba Ali Sayyed 050

2. Particulars
1) Introduction
2) What and Why?
3) Categories
4) Improve your P&L statement
5) Conclusion

3. Introduction
Profit and loss statement (P&L) or Income statement is one of the three
major financial statements along with cash flow statement
and Balance sheet.
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4. Why is it used? Who reads?
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5. Categories
Gross sales and services COGS
Gross Profit Administrative Exp
Selling and distribution Operating Profit
Interest Retained Earnings
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6. Category 1
Gross sales and services COGS
Gross sales and service - Gross sales means total sales that a business
receives from the product and services that it sells before deducting discount,
returns, allowance, rebate etc.
Cost of Goods Sold includes all of the costs and expenses directly related to
the production of goods.
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8. Gross Profit Administrative Expenses
Category 2
Gross profit - GP is that part of the revenue which is left after deducting all
direct cost/expenses from the Net sales
Administrative expenses are expenses an organization incurs that are not
directly tied to a specific core function.
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10. Category 3
Selling and distribution Operating Profit
Selling and distribution expense are those expenses which are incurred in
selling and distribution of goods and services.
Operating profit is the net income derived from a company’s core
business operations.
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12. Category 4
Interest Retained Earnings
Retained earnings (RE) is the amount of net income left over for the
business after it has paid out dividends to its shareholders.
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14. Improve your P&L
• Removal of Unprofitable products and services
• Re-check the pricing strategies
• Increase conversion rate
• Gain new customers
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15. Conclusion
It is critical to compare profit and loss statements from multiple
accounting periods since changes in revenue, real expenditure, non-
operating costs, and income over time are more informative than the
numbers themselves.
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16. Thank you !!